Detroit — The CEO of General Motors said Thursday that the automaker learned valuable lessons in the past year when it intervened to boost emergency production of ventilators to treat critically ill COVID-19 patients.
The company was able to help a small West Coast ventilator maker begin large-scale production in about a month. CEO Mary Barra said that gave GM confidence that it could accelerate other tasks, such as bringing electric and other vehicles to market faster.
“Doing the ventilator project was kind of a game-changer from a GM perspective, from a culture-changing perspective,” Barra said in an extensive conversation with members of the Detroit Automated Press Association.
In the past, Barra said, GM’s management team fought back when they were told they needed to help the company that builds 250 ventilators a month to speed production to 30,000 in 150 days.
“They were going to look at me like I was crazy,” she said.
Instead, employees approached the problem as if their loved ones might need breathing machines and achieved the goal, Barra said. Former President Donald Trump continues to accuse the company of being too slow.
In March of last year, General Motors put hundreds of workers on the project to help Seattle-area Ventec Life Systems ramp up production at a time when there were concerns the country might be short of respirators.
General Motors put in capital and turned an electronics plant in Indiana to help make ventilators as fast as one supply chain expert said “lightning fast.”
Barra said the company is now using the same approach for its electric vehicles, software and partially automated driver assistance systems.
Also at the event, Barra gave a strong hint that Michigan might get an electric car battery factory. When asked if the state has a chance to acquire a factory, she said discussions are underway.
“In the not-too-distant future, we will be able to answer that question,” Barra said, adding that an announcement is likely to come in a matter of weeks rather than months.
General Motors has announced plans to build four battery plants in North America. Two locations have been announced, Lordstown, Ohio, and Spring Hill, Tennessee.
Barra also gave a sneak peek at Tesla and its CEO, Elon Musk. When asked about Musk’s criticism of the Biden administration’s plan to give greater tax credits to buyers of electric cars made in the Union, she said it’s much more difficult to build cars for the broader mass market versus selling luxury cars to a segment of buyers.
She said GM shares are undervalued when compared to Tesla, Rivian, and Lucid Motors, all of which are relatively new companies with large market valuations focused solely on electric vehicles.
“Sometimes a traditional, famous company, although it innovates quickly, is looked at through a different lens,” she said.
Barra also said she doesn’t think GM will return to owning a huge inventory of vehicles at so many dealers, now that it has been able to deal with a global computer chip shortage with low stocks. She said that while there are some customers who want to buy a car right away, others want to order online and avoid going to a dealership, and GM will serve them both.
Her comments came after the company announced two more steps to ensure it had the raw materials to transition from petroleum to battery power. The company has announced a deal with MP Materials to supply rare earth metals and final magnets to electric vehicle engines from a new plant to be built in Fort Worth, Texas, starting in 2023.
It is also negotiating what will likely be a joint venture with Germany’s Vacuumschmelze (VAC) to build a US plant to manufacture electric vehicle magnets. Production is due to start in 2024 and will create “hundreds of new jobs,” the companies said.
The companies did not announce the financial terms of the deals. Shilpan Amin, GM’s head of purchasing and supply chain, said he has a parts supply agreement with MP Materials without a capital investment in GM. The project’s capital structure with VAC is still being prepared, but the companies have said they will build a plant together.
At present, Amin said, there are no factories in the United States equipped for large-scale production of electric vehicle motor magnets. The MP said 90% of the supply now comes from China.
The moves come as automakers scramble to assemble a supply of parts for what is expected to be a radical shift from internal combustion engines to zero-emissions electric power over the next decade. General Motors, for example, has a goal of selling only electric passenger cars by 2035.
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