Carter Racing Case

Carter Racing

John Carter and Fred Carter are faced with a business dilemma, to race or not to race in the Pocono race. Up to this point in the season, Carters Racing team has had a very successful year. They have finished in the top five of their races 50% of the time. However, they have also experienced engine failures and have a 29% chance of not finishing a race at all.

After reading this case the first time I thought that the Carters Racing should take the risk and partake in the Pocono race. I based my conclusion off of Burns’ First Law of Racing: “Nobody ever won a race sitting in the pits.” No guts no glory, right? In my eyes Carters Racing had nothing to lose and everything to gain from participating in the Pocono race. In terms of financing, it seemed logical that Carters Racing had to race. If Carters Racing did not participate in the race they will end the season $50,000 in debt. On the other hand, if they decided to participate in the race and finished in the top five they would secure a much needed million dollar sponsorship. Therefore, I thought it was reasonable that the Carters Racing team participate in the Pocono race.

However, after further evaluation of the case I have come to the conclusion that the Carters Racing should forgo this race for the following reasons. According to the data provided in the case it shows that in six of their seven engine failures accrued when the ambient air temperature was 70 Fahrenheit degrees are below. The lowest ambient air temperature engine failure accrued at 53 Fahrenheit degrees, which was the lowest temperature in which they competed. On the morning of the race the ambient air temperature is set to be 40 Fahrenheit degrees. The case provides no data on what the air temperature was during their twelve top five finishes. Therefore, I am left to believe that the engine mechanic, Mr. Paul Edwards may be correct in his assumption that there is a higher probability of engine failure in a...