Update: Trump Says GM ‘Wasting Time,’ Invokes Defense Production Act
Update: 3/27/2020 5:01 p.m.: Statements from White House and GM
WASHINGTON – President Donald Trump has authorized Secretary of Health and Human Services Alex Azar to use authority under the Defense Production Act to require General Motors Corp. to produce ventilators for combating the coronavirus pandemic.
“Today, I signed a Presidential Memorandum directing the Secretary of Health and Human Services to use any and all authority available under the Defense Production Act to require General Motors to accept, perform, and prioritize Federal contracts for ventilators,” Trump said in a statement posted on the White House website. “Our negotiations with GM regarding its ability to supply ventilators have been productive, but our fight against the virus is too urgent to allow the give-and-take of the contracting process to continue to run its normal course. GM was wasting time. Today’s action will help ensure the quick production of ventilators that will save American lives.”
In an emailed response for comment, GM states that it, Ventec Life Systems of Bothell, Wash., and its supply based “have been working around the clock for weeks to meet this urgent need.” GM is working with Ventec to product the latter’s VOCSN critical care ventilators at its Kokomo, Ind., manufacturing facility with FDA-cleared ventilators scheduled to ship as soon as next month, according to a statement earlier in the day.
“Our commitment to build Ventec’s high-quality critical care ventilator, VOCSN, has never wavered,” GM states. “The partnership between Ventec and GM combines global expertise in manufacturing quality and a joint commitment to safety to give medical professionals and patients access to life-saving technology as rapidly as possible. The entire GM team is proud to support this initiative.”
Trump’s statement comes after the president made several tweets earlier Friday, calling on GM to reopen the shuttered Lordstown plant, which it sold to Lordstown Motors Corp. last year to produce electric vehicles. In a series of tweets, Trump blasted GM and its CEO, Mary Barra, over an apparently stalled plan to manufacture respirators at the company’s Kokomo, Ind., plant. According to CNN, GM is asking the government to foot the costs for retooling the plant, which normally assembles electronics.
“As usual with ‘this’ General Motors, things just never seem to work out. They said they were going to give us 40,000 much needed Ventilators, ‘very quickly,’ ” Trump wrote. “Now they are saying it will only be 6000, in late April, and they want top dollar. Always a mess with Mary B.”
He next tweeted that GM “MUST immediately open their stupidly abandoned Lordstown plant in Ohio, or some other plant, and START MAKING VENTILATORS, NOW!!!!!! FORD, GET GOING ON VENTILATORS, FAST!!!!!!”
In a third tweet, he clarified that “Invoke “P” means Defense Production Act!”
Lordstown Motors, an electric vehicle startup that plans to manufacture pickup trucks at the former GM Lordstown plant, purchased the building last year. GM agreed to provide $40 million in financing to the startup, though GM has an option to lease the facilities and land that expires April 1. It also has an option to repurchase the assets that expires May 30
In a tweet of his own, U.S. Rep. Tim Ryan, D-13 Ohio, responded to the president’s tweets, saying “We agree,” and adding that Trump could activate the Defense Production Act to take over the supply chain.
“Please stop blaming others and be the leader this country needs right now,” Ryan tweeted. “The only thing standing in your way, Mr. President, is you!”
Ventec and GM have been working together since March 20 on the plan for the production, according to the release. Their global supply based developed sourcing plans for the more than 700 individual parts needed to build up to 200,000 VOCSN ventilators.
“This unique partnership combines Ventec’s respiratory care expertise with GM’s manufacturing might to produce sophisticated and high-quality critical care ventilators,” said Chris Kiple, CEO of Ventec Life Systems. “This pandemic is unprecedented and so is the response, with incredible support from GM and their suppliers. Healthcare professionals on the front lines deserve the best tools to treat patients and precision critical care ventilators like VOCSN are what is necessary to save lives.”
GM will immediately deploy some 1,000 American workers to scale production of critical care ventilators, and has worked with the UAW to bring back employees from its Kokomo and Marion plants.
“We are proud to stand with other American companies and our skilled employees to meet the needs of this global pandemic,” said Mary Barra, GM chairman and CEO. “This partnership has rallied the GM enterprise and our global supply base to support Ventec, and the teams are working together with incredible passion and commitment. I am proud of this partnership as we work together to address urgent and life-saving needs.”
GM will also begin manufacturing FDA-cleared Level 1 surgical masks at its Warren, Mich., plant next week. Within two weeks, the company looks to ramp up production to 50,000 masks daily, with the potential to increase to 100,000 per day, according to the release.
Pictured: President Donald Trump speaks about the coronavirus in the James Brady Briefing Room, Thursday, March 26, 2020, in Washington, as Vice President Mike Pence listens. (AP Photo/Alex Brandon)
Copyright 2020 The Business Journal, Youngstown, Ohio.