By on April 8, 2020

General Motors Renaissance Center

To its credit, General Motors was already preparing a foray into ventilator production when President Donald Trump invoked the Defense Production Act, locking the automaker into a pact to build truckloads of the life-saving equipment.

On Thursday, details of the no-profit deal became clear.

As reported by CNBC, federal officials say the automaker will add 30,000 ventilators to the federal stockpile by the end of August, with the deal carrying a pricetag of $489.4 million. The publication confirmed that GM will not make a profit off the effort.

Amid large coronavirus outbreaks in New York City, Detroit, and other locales, most automakers are doing their part in providing personal protective equipment to hospitals and state health agencies, but ventilators are a complicated piece of kit. They’re not cheap, either.

GM partnered with Ventec Life Systems to make the order possible. Despite media reports claiming a lofty sale price for the units, the agreement with the feds shows a per-unit price of $16,000, well below the $50k price tossed around last week.

Production starts next week, with the Department of Health and Human Services claiming first batch of over 6,100 ventilators due for delivery at the beginning of June. While the production surge could be seen as coming too late for the onset of the pandemic, it’s crucial for future outbreaks. Many health officials anticipate a second or even third wave of the virus over the next 18 to 24 months.

Production will take place at GM’s underutilized Kokomo, Indiana components plant, where the company expects to employ 1,000 workers on the ventilator initiative. It’s good news for UAW Local 292, which has long sought to boost the plant’s workforce.

“We remain dedicated to working with the Administration to ensure American innovation and manufacturing meet the needs of the country during this global pandemic,” said GM in statement.

[Image: General Motors]

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24 Comments on “Ordered Into Action: GM and Feds Announce Ventilator Deal...”


  • avatar
    Lie2me

    Send them to the states before the feds

    Ok, come at me

  • avatar
    cprescott

    The issue here is that we have an ungrateful company who stole over $20 billion in taxpayer funds without paying a dime of interest or taxes who wasn’t the FIRST to come to the aid of the country. They can spin this that they were going to do this all along, but like most things at GM, they dwaddled with the decision. This company should have been dismantled and sold off. The continued arrogance of the company is puke inducing.

    • 0 avatar
      SCE to AUX

      1. They didn’t steal anything. The bailout was requested and granted by the Bush, then Obama Administrations. Yes, they should have repaid all of the money, but they didn’t; get over it. Take it up with your elected representatives, who freely provide corporate welfare just for the asking.

      2. GM builds vehicles, not ventilators. You must think raw materials pour into one end of the plant, magic happens, and the product of your choice pops out at the end.

      You have no idea what you’re talking about.

      • 0 avatar
        JimZ

        “You have no idea what you’re talking about.”

        this applies to 99.5% of people on Facebook, Twitter, blogs, and internet comments. they just parrot what their favorite “information” source tells them. They claim they’re the only ones who can “think for themselves” yet you can almost always map their words 1:1 to something spoken by a talking head or written by an obscure political blogger.

      • 0 avatar
        JMII

        This +1

        I just don’t understand why so many think that automakers should be the ones to make these things. Just because they have large factories and tons of workers? Most restaurant employees are out of work right now but nobody is yelling at them to build stuff.

        Many decades ago the big 3 switched to building airplanes and tanks for the war effort but back then the assembly lines weren’t fully optimized with computers and robots for car production like they are today. It takes them MONTHS to switch from one model year to the next – and that is building the same thing, so it is not a light switch.

        I too did not agree with the bailout, if you can’t run a profitable business then something is wrong with your organization. However the flip side is everything becomes made in China or Mexico. Do you want that? So if some kind of cash incentive, loan, tax break, etc is required to keep manufacturing jobs in the US then that is just the way it is these days.

        • 0 avatar
          APaGttH

          Because multiple automakers are repurposing their existing auto parts to make the devices.

          Ford has designed puffer suits using F150 parts.

          Tesla made BiPAP machines with Tesla parts, and now is designing full ventilators with Tesla parts.

          You can’t make a ventilator with a pen, order pad, wait tray, dish rag, and a key card to swipe a POS terminal. Not to belittle restaurant workers but they don’t have an engineering base, or an extensive collection of circuits, timers, bidirectional valves, filter systems, electronic switches and programmable interfaces to dive into.

          The automakers do.

        • 0 avatar
          Scoutdude

          GM is telling those restaurant workers to build something and that something is ventilators. Seriously the plant they are converting normally ran about 500 employees, GM is not making their existing workers take those jobs and they need 1000 employees. The existing GM employees have to volunteer, as can other GM employees in the vicinity. However since they don’t think they can fully staff it with current employees they are hiring. Sure that restaurant worker might not have the skills to do some of the operations, but they can probably wrap the completed unit in bubble wrap, place it and the paper work in a box tape it closed and put it on a pallet.

          Also the gov’t “telling the automakers to build ventilators” is just PR. GM started talks with getting a production line set up with Ventec before the DPA. Ford worked with 3M to design and build powered HEPA filtration hoods using F-150 parts, 12v power tool batteries and a 3M HEPA filter before the DPA, they also started talks with US based ventilator companies and had decided on one to work with that they felt would be the quicker to tool up due to the lower functionality and attendant fewer parts, time to assemble and test. Again before the DPA

          Tesla however is another matter, Elon is being the PR whore and has bought some used CPAP and BiPap machines put Tesla stickers on them and did PR shots handing them over, despite the fact that they are NOT ventilators and are not a suitable substitute. Then there is the PR stunt of using a Tesla navigation computer and touch screen to run some things that again are not an actual FDA approved ventilator. So nothing more than a Meeeeee-Tooooooo. I’m certain that Ventec would help them set up production of their approved and tested machines just like they did with GM and considered to do with Ford.

          Meanwhile even FCA is doing something worthwhile, just not in the US. In Italy they have already have one of their component plants producing parts for an Italian ventilator company to help them ramp up production.

      • 0 avatar
        Peter Gazis

        SCE to Aux

        Magic does happen. The C8 Corvette is proof.

  • avatar
    1500cc

    In every article on the first page, your comments are nothing but negativity and vitriol towards the employees, companies, and products mentioned. Is this an act? Are you trolling, looking for responses like this one? Or are you truly this miserable? It’s okay to say something positive once in a while.

  • avatar
    SCE to AUX

    “While the production surge could be seen as coming too late for the onset of the pandemic, it’s crucial for future outbreaks.”

    As I’ve said here before, it’s a fantasy to think that switching from vehicle production to FDA-approved life-saving products is easy, quick, or safe. 9 women can’t have a baby in 1 month.

    I wonder what the supply chains will look like for these things. In many cases, they’re probably forced to go to the same wells as the real ventilator companies do.

    • 0 avatar
      JimZ

      “I wonder what the supply chains will look like for these things. In many cases, they’re probably forced to go to the same wells as the real ventilator companies do.”

      they are. in various cases these efforts have been slowed due to the ventilator designs relying on parts made in China and India which were not easy to get.

    • 0 avatar
      Scoutdude

      GM is building an existing, approved design, so yeah they are using many of the same components from the same suppliers, or in some cases building those components in house.

  • avatar
    jkross22

    When these require repair (first batch or otherwise), how easily will it be to obtain parts? Will GM make them? For how long? As part of the government deal, will GM be compelled to share schematics of the vents so that other companies can repair and maintain these expensive devices?

    I have no problem with GM turning a profit on something the government is compelling them to make, but gov’t should cap the profit of each vent sold.

    The skeptic in me doesn’t believe 16k is the sum total of what GM is getting for this.

    • 0 avatar
      Scoutdude

      GM is building an existing design from Ventec so they are the ones that own the schematics, patents, ect GM is just setting up an additional plant as the one in Woodinville, WA can only increase production so much. So yeah when all is said and done the GM line will be dismanteled and Ventec will service the product whether it came out of their own plant or GMs.

  • avatar
    NeilM

    Re parts and repairs, isn’t GM performing as, in essence, a temporary contract manufacturer for Ventec’s existing medical ventilator product? This has the advantage that the design is already tested and approved — i.e. no invention required.

    In which case parts and repairs shouldn’t be a problem.

  • avatar
    APaGttH

    GM also converted the shuttered Warren, MI plant into a N95 production facility.

    Just sayin’

  • avatar
    ToolGuy

    HHS… a big bundle of awesomeness.

    (Oh wait, I mean non-awesomeness – going strictly on results. Split the U.S. population into 4 quartiles, healthwise. Take the bottom quartile out of scope – they have issues. Take the top quartile out of scope – they aren’t generally relying on HHS for health tips. Take the middle half [middle two quartiles] and evaluate their general condition of health – how proud are you?)

  • avatar
    SaulTigh

    I think we’re going to end up building a bunch of vents that won’t be needed. Been reading over the last day or so that doctors are now trying to do everything they can to NOT put WUHAN flu patients on ventilators. I’ve also been reading that 80-90% of people that are put on vents for any reason don’t survive normally anyway, because once you get to the point of needing a vent, you generally aren’t coming back from what ails you.

    My personal opinion is that the worst decisions get made when people give in to the notion that they HAVE to do something. I don’t spend every flu season cowering in fear, and I refuse to do so now. Rationally, where I live, and with a normal level of precaution (wash hands, not touch face holes) and modest social distancing, the chances of me catching the WUHAN flu are very, very low.

  • avatar
    Dan

    ARDS + ventilation is 50/50 at the best of times. It appears that when SARS-2 progresses to the oxygen starvation point it’s also damaged the hemoglobin in the blood (among other things) to the point that ventilation rarely helps.

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