GM, Ventec Announce Capability To Produce 10K Ventilators Monthly After Trump Lashes Out On Twitter

General Motors (NYSE:GM) and Ventec Life Systems announced details on a partnership to produce ventilators at GM's Kokomo, Indiana plant Friday, following a report that the White House had called off an earlier rollout of the effort with GM and Ventec.

GM and Ventec's announcement came about one hour after a swipe by President Donald Trump on Twitter at GM on Friday over ventilator production.

Hospitals battling the coronavirus pandemic in hotspots such as New York are expected to run short of the medical devices, which are needed for patients with the virus who are in respiratory distress.

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The White House event was canceled after the Federal Emergency Management Agency said more time is needed to asssess the estimated cost of more than $1 billion for the GM-Ventec proposal, The New York Times reported, citing unnamed government officials.

An initial promise from the companies of quickly producing 20,000 ventilators fell to a figure of 7,500 or less, the newspaper said.

The deal would have paid several hundred million upfront to GM to retool their Kokomo plant, the Times said. FEMA is reportedly studying more than a dozen other proposals.

GM, Ventec Say They Can Produce 10K Ventilators Per Month

GM and Ventec said they will build VOCSN critical care ventilators at the Kokomo plant, with FDA-cleared ventilators planned for shipment as soon as April. Ventec is also taking "aggressive steps" to ramp up production at a Bothell, Washington facility, according to the press release.

The setup of tooling and manufacturing at the Kokomo plant is already underway, according to GM and Ventec.

"Depending on the needs of the federal government, Ventec and GM are poised to deliver the first ventilators next month and ramp up to a manufacturing capacity of more than 10,000 critical care ventilators per month with the infrastructure and capability to scale further," according to the Friday press release.

GM said it is donating its resources to the effort at cost. The automaker also said it will begin making Level 1 surgical masks at its Warren, Michigan plant next week. Production is expected to reach 50,000 masks per day within two weeks, with the potential to reach 100,000 per day, GM said. 

“We are proud to stand with other American companies and our skilled employees to meet the needs of this global pandemic,” GM Chairman and CEO Mary Barra said in a statement.

“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.”

Trump Lashes Out At Automakers On Twitter

At 11:16 a.m. Friday, Trump name-checked General Motors and Ford Motor Company (NYSE:F) in a whiplash-inducing tweet demanding more ventilators, despite downplaying New York's need for them in a Fox News interview the night before. 

General Motors 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!!!!!! @GeneralMotors @Ford

— Donald J. Trump (@realDonaldTrump) March 27, 2020

GM in fact sold the former Chevrolet Cruze plant in Lordstown, Ohio referenced by Trump to a startup electric truck manufacturer in 2019. 

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”. Now they are saying it will only be 6000, in late April, and they want top dollar. Always a mess with Mary B. Invoke “P”.

— Donald J. Trump (@realDonaldTrump) March 27, 2020

GM Price Action

GM shares were down 4.56% at $21.54 at the time of publication Friday. 

Photo courtesy of GM and Ventec.