World News

GM begins production of ventilators for U.S. government

By David Shepardson

(Reuters) – General Motors Co said on Tuesday it had started producing ventilators in the volume needed to treat severely ill coronavirus patients and would deliver the first batch of the medical equipment to the U.S. government this month.

The U.S. Department of Health and Human Services (HHS) has awarded nine contracts totaling nearly $2.6 billion to produce 137,000 ventilators by the end of 2020 for the U.S. Strategic National Stockpile, including a contract to GM worth $489.4 million for 30,000 ventilators by the end of August after President Donald Trump invoked the Defense Production Act.

Other contracts announced by HHS in recent days include a $646.7 million contract to Dutch health technology company Philips and others to General Electric Co, Hill-Rom Holdings Inc, Medtronic Plc , ResMed Inc, Vyaire Medical Inc, Hamilton Medical AG and Zoll Medical Corp.

Hamilton is receiving a $552 million contract for 14,115 ventilators, while Vyaire is receiving a $407.9 million contract for 22,000 ventilators produced by June 29 and Zoll is receiving a $350.1 million contract for 18,900 ventilators, HHS said on Monday.

HHS Secretary Alex Azar said in a statement the contracts “will mean we have more capacity to respond to the pandemic as it evolves.”

GM, which is working with ventilator firm Ventec Life Systems to produce the medical equipment, said it would ship more than 600 ventilators in April.

It added that it expected to fill nearly half the order by the end of June and the full order by the end of August. The ventilators will be produced at a plant in Kokomo, Indiana.

White House adviser Peter Navarro said that “as these lifesaving ventilators roll off GM’s assembly line as fast as tanks once did in an earlier World War, they will be rapidly deployed.”

GM’s shares closed flat. The stock has fallen more than 37% this year, as coronavirus-related lockdowns weigh on automobile sales.

(Reporting by David Shepardson in Washington and Ankit Ajmera in Bengaluru; Editing by Aditya Soni and Peter Cooney)