US automakers study medical manufacturing as coronavirus squeezes capacity

Dive Brief:

Ford and General Motors are looking into the possibility of shifting some of their production capacity to help make medical equipment, both companies confirmed to Supply Chain Dive.
The U.S. federal government is actively looking for manufacturers to make medical supplies to assist with the COVID-19 outbreak and has asked the National Association of Manufacturers (NAM) to help find available capacity. "If you are able to assist with the production of critical supplies, they’d like to know that," Joe Angel, the president of PMMI Media Group, said in an email asking members to take a survey on production ability.
European governments are taking similar steps to increase production of ventilators and other critical medical equipment. U.K. Prime Minister Boris Johnson spoke with more than 60 manufacturing companies earlier this week asking them to shift production to medical supplies and provided them with clinical and design specifications required to make the devices, 10 Downing Street announced this week.

Dive Insight:

On Wednesday, President Donald Trump signed an executive order invoking the Defense Production Act , which allows the government to contract with industry and control the production of items considered "essential to national defense," according to NPR.

The switch to producing medical equipment will require new supply lines running to the manufacturing facilities with the components needed to assemble the needed products. Internal operations at the facilities used to making automobiles will also need to adapt to medical device production.

One ventilator manufacturer, Allied Healthcare Products, told The New York Times it would take about eight months "to sharply increase production."

"Ford stands ready to help the administration in any way we can, including the possibility of producing ventilators and other equipment," Ford said in a statement emailed to Supply Chain Dive. "We have had preliminary discussions with the U.S. and U.K. governments and [are] looking into the feasibility."

White House economic adviser Larry Kudlow said the administration had spoken with General Motors CEO Mary Barra about the company helping with the production of ventilators and other equipment.

"We can confirm that this is something we’re studying in order to understand needs and capabilities but its too early to discuss timeline or production," GM said in a statement emailed to Supply Chain Dive. "Its an internal study at this point."

There are currently 160,000 ventilators in the U.S. health system, according to one estimate published in the journal Disaster Medicine and Public Health Preparedness. But demand could soar much higher — more than 700,000 by one estimate — in a pandemic.