The U.S. Department of Health and Human Services announced Wednesday its first contract with General Motors to produce 30,000 ventilators for the national stockpile. The contract is rated under the Defense Production Act, forcing GM to give that order priority over other production commitments, as President Trump used the act to compel the automaker to produce ventilators for the national stockpile. These ventilators will be a critical tool in helping patients stricken by breathing problems from contracting coronavirus.
The contract calls for GM to deliver 6,132 ventilators by the end of May 2020. From there, it will have to produce 30,000 ventilators by the end of August. HHS Secretary Alex Azar said in the agency’s official announcement, “We’re grateful to the GM team for working with the federal government to expand our nation’s supply of ventilators as the pandemic evolves.”
By using the Defense Production Act, Azar went on to state that suppliers will also have to sell necessary parts to GM ahead of other clients to ensure it meets the production schedule. “By rating contracts under the DPA, HHS is helping manufacturers like GM get the supplies they need to produce ventilators as quickly as possible, while also ensuring that these ventilators are routed through the Strategic National Stockpile to where they’re needed most.” GM previously announced a partnership with Ventec Life Systems, deploying its manufacturing capacity to build ventilators whether the government forced it to or not.
According to an NPR report, a GM spokesperson said it is manufacturing these ventilators at-cost, and it will not make a profit on the project.
For its part, GM did not elaborate on HHS’ announcement. Instead, it released a short statement:
“GM and Ventec Life Systems are working with speed and urgency to arm front-line medical professionals with the critical care ventilators they need to treat seriously ill patients. GM is proud to deploy its purchasing and manufacturing capability alongside the respiratory care expertise of Ventec. We remain dedicated to working with the Administration to ensure American innovation and manufacturing meet the needs of the country during this global pandemic.”
Ford announced it would also build 50,000 ventilators in partnership with GE Healthcare. No news of a final contract with the U.S. government has been confirmed yet there, but both automakers are working toward the administration’s goal of supplying 100,000 ventilators to hospitals within 100 days.