General Motors
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GM, Ventec Land Contentious Contract to Produce Ventilators for US Government

April 8, 2020
According to Bloomberg News, the contract is worth almost $500 million.

On April 8, Ventec Life Systems and General Motors Co. officially landed a deal that two weeks ago had them in hot water with the White House. The contract, which Bloomberg News reports as worth $489.4 million, lays out a timeline for the partnership to deliver 30,000 ventilators to the Department of Health and Human Services by the end of August, with at least one-fifth of those to be delivered before June 1.

General Motors and Ventec have been in discussions since March 20 on bringing the ventilator-production partnership to life. The two companies sought a contract from the government to begin producing the machines, and on March 27 President Trump, excoriating GM CEO Mary Barra on Twitter for moving too slowly, invoked the Defense Production Act to spur the partnership into acting faster. In a statement today acknowledging the contract, GM said they are “dedicated to working with the Administration to ensure American innovation and manufacturing meet the needs of the country.”

In order to ramp up production, General Motors converted its auto-parts plant in Kokomo, Indiana into a ventilator factory staffed by paid volunteers from the United Auto Workers union, which represents GM employees. According to Ventec Life Systems, the Kokomo facility is well suited to produce precision electrical components.

“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 Bothell, Washington-based Ventec.

Manufacturers around the country have shifted gears and re-made production lines in order to produce face masks, shields, and other personal protective equipment for front line medical professionals fighting the COVID-19 outbreak, but ventilators are a different beast from PPE.

Unlike respirators, fabric masks or face shields, ventilators are complex electronic devices with circuits and control boards. Hospitals, which ordinarily only need a handful of ventilators in their intensive care units, have seen demand for the ventilators skyrocket in coronavirus hot spots as the virus attacks the respiratory system. Ford Motors has also responded to the demand for ventilators by working with GE Healthcare to design a simplified respirator they say works for most patient needs.

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