A notebook and pen laying on a table

Ivey Memo: How much is your life worth

So how much do you think your life is worth? $100M? $20M? $420? According to the IVEY MEMO, the value of your life is $200,000. Evidently, GM saved over $250M by letting a few hundred people burn to death in their cars.

For nearly 30 years, automobile manufacturers have skirted the issue of fundamental design flaws that make cars prone to catch fire when involved in a crash. Engineers know how to relocate fuel tanks to make them less likely to leak or suffer punctures, but manufacturers have never been held responsible for ensuring their vehicles are safe.

It is estimated that 20,600 passenger cars catch fire in accidents each year, killing 1,100 people and seriously injuring 3,200. General Motors, in the now-infamous 1973 “Ivy Memo,” estimated that there were “a maximum of 500 fatalities per year in accidents with fuel-fed fires where the bodies were burnt.”

Rather than immediately approaching its engineers to redesign a safer automobile, the memo sets out a calculation to determine which would cost less – a human life or a new design. GM figured it would cost around $8.59/vehicle to protect fuel tanks in crashes. Then, mechanical engineer Edward C. Ivey, author of the memo, calculated a value of $200,000 for each human life lost in an automobile fire. By figuring the amount of GM cars currently on the road, Ivey reasoned it would save GM about $6.19/vehicle or $253,790,000 to simply let the people burn up.

GM took Ivey at his word, and made no significant changes in the design of its automobiles to protect the fuel tanks, buried the memo, and began lying about its knowledge of its fuel tank hazards. Meanwhile, GM fuel tanks continued to rupture in roadway crashes, resulting in horrific deaths.

The memo finally came to light in 1998 when a Florida judge ordered it into evidence in a case in a case involving two children who burned to death in 1991 when a small utility trailer ran into a 1983 Oldsmobile station wagon at low speed and punctured its fuel tank.

It is only by bringing this information to public attention, and holding automobile manufacturers up to public scrutiny, that any significant changes will ever take place.

And, in case you’re wondering – you’re “worth more” today. $200,000 in 1973 is equivalent to $1,013,428.57 in 2007.

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