GM And Ventec Fill Staggering $489M Order From U.S. Government

It’s been a rocky road for the nation as COVID-19 breaks out across the country, challenging healthcare systems to cope with surging patient admissions, staffing concerns, and equipment restrictions. Ventilator shortages have been making headlines in recent weeks, and so it continues as Ventec Life System – in partnership with GM – sees its largest single order in the history of the firm.

The US's Department of Health and Human Services placed a $489.4 million order for 30,000 of its portable VOCSN ventilator through GM. The auto manufacturer is under a presidential order to produce the life-supporting machines and is currently overhauling its Kokomo, Indiana assembly line to fill that order. Ramping up production is expected to take several weeks, but the carmaker promised to deliver 6,132 ventilators by June 1.

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Many patients suffering from coronavirus-related respiratory complications require ventilators to help them breathe, and limited availability of the equipment meant doctors had to choose who would and wouldn't get access to them. A public furor pushed President Trump into taking measures to procure more machines, personal protective equipment, and other emergency supplies as soon as possible. However, some of the president's actions have created controversy in the media. There was friction between the current administration and GM after the president posted provocative opinions on Twitter. In one instance, the president went after General Motor's CEO, Mary Barra, directly.

“As usual, with ‘this’ General Motors, things just never seem to work out,” Trump wrote in a March 27 tweet. “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.”

GM responded with a denial of Trump’s claims – stating their commitment to building these critical care machines is unwavering. In a news release, they assured the public they were “working around the clock” with Ventec to ensure the factory is ready and promised ventilators as soon as next month. With the placement of this order, relations between the federal government has eased somewhat.

“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,” said Health and Human Services Secretary Alex Azar.

While Ventec is also ramping up production at its production line in Bothell, Washington, chief strategy officer Chris Brooks says they are focused on getting their GM system up and running. The government contract is a priority for both the device builder and automaker – describing the comings and goings of engineers and other specialists needed to start rolling out the life-saving technology.

The average Ventec ventilator machine costs roughly $17,000, but the adapted one being built at the GM factory doesn't have the nebulizer and suction unit feature. The modified version is streamlined to save both time and cost. As for GM, Brooks verified that they would be providing the factory and 1,000 workers at cost to the initiative.