Ford Motor and GE Healthcare plan to produce 50,000 ventilators within the next 100 days at a facility in Michigan to assist with the coronavirus pandemic.
Production of the critical care devices is expected to begin with 500 United Auto Workers union members the week of April 20, according to executives at both companies. Ford’s Rawsonville Components Plant in Ypsilanti, Michigan, will be able to produce 30,000 ventilators a month after early July, officials said.
The companies expect to produce 1,500 by the end of April, 12,000 by the end of May and 50,000 by July 4, officials said.
The design of the ventilator is being licensed by GE Healthcare from Florida-based Airon Corp., a small, privately held company specializing in high-tech pneumatic life support products. The devices are less complex than GE ventilators Ford previously said it would assist the company in producing at other facilities.
Ford, in collaboration with GE Healthcare, will leverage the design of Airon Corp.’s FDA-cleared ventilator to produce in Michigan.
“We are really excited and applaud Ford, how quickly it’s mobilized its manufacturing facilities to address the challenges we all face with COVID-19,” Tom Westrick, vice president and chief quality officer of GE Healthcare, said during a call Monday afternoon with media.
The more “basic” ventilators are “well-suited to address the urgent needs during the COVID crisis,” Westrick said. The devices operate on air pressure without the need for electricity, according to Jim Baumbick, Ford vice president of Enterprise Product Line Management.
Ford, according to Westrick, does not have any private customers at this time to purchase the ventilators and is “working closely” with government officials to fulfill needed demand.
Westrick said the decision to partner with Ford and use its employees was “based specifically on speed and our ability to increase capacity as fast as we could.”
The Industrial Division of Communication Workers of America union, which represents the largest share of General Electric employees in the U.S., earlier in the day had demanded the company use its employees for such work.
GE’s Aviation unit is cutting 10% of its U.S. workforce, about 2,600 employees. Additionally, it will furlough 50% of its U.S. maintenance, repair and overhaul employees for 90 days.
Shares of Ford fell 3.1% Monday, closing at $5.03.
The announcement comes three days after President Donald Trump ordered Ford’s crosstown rival, General Motors, to make ventilators under the Defense Production Act hours after criticizing the company for not acting quickly enough to produce the devices amid the coronavirus pandemic.
The Korean War-era statute can force certain American companies to produce materials that are in short supply in the face of the growing outbreak.
GM has said it plans to ramp up to a manufacturing capacity of more than 10,000 critical care ventilators per month.
The announcement adds to Ford’s efforts to assist in increasing health care supplies amid the pandemic, including ventilators, respirators and face masks.
The company earlier this month announced plans to work with GE to expand production of a simplified version of the company’s existing ventilator design to support patients with respiratory failure or difficulty breathing. Ford also partnered with 3M to manufacture air-purifying respirators.
— CNBC’s Noah Higgins-Dunn contributed to this report.
Correction: This story has been updated to clarify GE Aviation’s layoff plans.