International Circuit
Trump Orders General Motors To Make Ventilators
WASHINGTON— President Trump ordered General Motors Co. to sharply ramp up the production of ventilators to treat coronavirus patients, turning to a wartime presidential power that he had been reluctant to use.
Mr. Trump on Friday invoked the Defense Production Act, or DPA, which dates back to the Korean War and gives the president powers to require businesses to produce goods tied to national defense. For weeks he had said that the threat of invoking the DPA was sufficient. Previously he likened using the DPA to nationalizing American business. He reversed course Friday, saying GM was “wasting time” in negotiations with the federal government.
With the number of confirmed cases of Covid-19—the disease caused by the new coronavirus—topping 100,000 in the U.S. on Friday, worries about a ventilator shortage have grown all the more urgent.
GM was already working toward wide-scale ventilator production through a collaboration struck last week with medical-device firm Ventec Life Systems.
On Friday, the Detroit auto maker said, “Ventec, GM and our supply base have been working around the clock for weeks to meet this urgent need.”
The president had criticized GM and its leadership earlier Friday, saying in a series of Twitter posts that the company had initially said it could supply 40,000 ventilators, but then later said it could make only 6,000 available by late April. In one of his Friday tweets, the president criticized GM Chief Executive Mary Barra as “always a mess.”
White House officials said the two sides had been discussing a contract worth about $1 billion, but the talks broke down over the timeline for delivering the devices.
Earlier Friday, after the president’s Twitter posts, GM and Ventec said they aimed to produce as many as 10,000 ventilators a month, in part through a new assembly line being set up at a GM facility in Indiana. Closely held Ventec normally makes a few hundred ventilators a month at its facility in Bothell, Wash.
The most severely ill patients infected with the new coronavirus have such trouble breathing that they are put on a ventilator, an invasive therapy that involves inserting a tube into the patient’s windpipe.
People involved in GM’s efforts said Ventec hadn’t made a firm commitment to deliver a specific number of ventilators, but rather provided the administration with a range of potential production volumes that would scale up to gradually starting in April.
With hospitals in some areas experiencing a surge in Covid-19 patients, the Trump administration wanted a faster ramp up to meet the urgent need, a White House official said.
GM, and other car companies that have moved to help boost the ventilator supply don’t plan to retool their existing vehicle-assembly plants to produce the devices. Instead, they are lending their expertise in supply-chain management, purchasing and manufacturing to help other medical-device makers boost output. In GM’s case, this meant establishing a new manufacturing line at its electronic-parts factory in Indiana.
GM said about 1,000 employees would work on the project and that the company’s resources would be donated “at cost.”
Some of GM’s auto-parts suppliers began churning out parts for the ventilators in recent days, the people familiar with the effort said.
“If you think about what goes into a vehicle—the air-circulation systems, filtration, electronics, lots of hoses—a lot of those types of components also are contained in ventilators,” said Carla Bailo, president of the Center for Automotive Research.
The president has publicly admonished GM and Ms. Barra personally several times during his tenure. Last year he repeatedly criticized GM for closing factories and laying off workers in Midwestern states.
In his series of tweets, Mr. Trump said GM should reopen its plant in Lordstown, Ohio, to make ventilators, “or some other plant.” GM last year sold the Ohio factory to a start-up electric truck maker.
President Trump also tweeted that Ford Motor Co. needed to “get going on ventilators, fast!!!”
In the past two weeks, several auto makers, including Ford, have disclosed plans to work with medical-device companies to boost ventilator production. Ford this week said it would work with General Electric Co. to increase ventilator supply but didn’t offer specifics.
Toyota Motor Corp. said Friday that it is finalizing terms with two ventilator makers to help increase their capacity.
The president said later Friday that the administration was working to sign contracts with more than a half-dozen other companies, including General Electric, Philips, Hamilton and Medtronic
He said the administration had deals in place to collect 100,000 ventilators within 100 days. Speaking to reporters at the White House, Mr. Trump said he was skeptical that the U.S. would need as many ventilators as the administration was collecting, adding that he may send any surplus to other countries. To underscore the point, he said he spoke to the U.K. Prime Minister Boris Johnson, who tested positive for the virus, and asked how his British counterpart was doing. Mr. Johnson told him: “We need more ventilators.”
Tesla Inc. Chief Executive Elon Musk has said he is working with medical device-maker Medtronic PLC and has said the auto maker’s New York solar panel factory “will reopen for ventilator production as soon as humanly possible.” He also said he acquired ventilators from China and has been working to deliver them in the U.S.
On Friday, New York City Mayor Bill de Blasio said on Twitter that he had talked with Mr. Musk late Thursday. “He’s donating hundreds of ventilators to New York City and state, including our public hospitals.”
On Friday, Mr. Musk said on Twitter the biggest value Tesla was providing was precise delivery of ventilators to the intensive care units that need them most. “There are many ventilators in warehouses, but stuck in logistics/routing/paperwork issues,” he wrote.-Wall Street Journal
