GM General Motors Company

By Katy Stech Ferek 

WASHINGTON -- General Motors Co. is asking the Trump administration to drop import tariffs on Chinese parts that the auto maker needs to make ventilators, saying the levies will make it more expensive to build desperately needed machines that can save lives.

In a letter to the U.S. Trade Representative, GM officials asked the federal government to grant exclusions for several categories of ventilator parts made in China. The existing tariffs on ventilator parts "could potentially impede the ability of GM and other U.S. manufacturers to source parts for critical care ventilators quickly, reliably, and at as reasonable a cost as possible," said the letter, which was dated Tuesday and made public Thursday.

A representative for the USTR's office didn't immediately respond to a request for comment.

Federal trade officials worked with the U.S. Department of Health and Human Services to make sure that some crucial medicines and medical products could be imported without the extra tariffs. U.S. officials said last month that they also determined to not impose tariffs on oxygen masks and ventilators themselves.

In their letter, GM officials pointed out that tariffs remain on several categories of components used to make ventilators domestically, including filters parts, compressor silencers, grommets and a power cord set.

In a statement Friday, the auto maker said that most of the ventilator components would be sourced in the U.S. and North America, and that the "outcome of the request will have no impact on GM's commitment to this important effort."

The federal government began collecting extra tariffs on most of the ventilator parts in September 2018. They are being tariffed at a rate of 25%.

U.S. trade officials began collecting extra tariffs on some Chinese-made goods in 2018 as part of their effort to pressure the country's manufacturing community to stop stealing U.S. intellectual property.

The shortage of ventilators used to treat patients suffering with the disease caused by the new coronavirus has GM and other major manufacturers scrambling to make more for strapped hospitals.

The auto industry, like in times of past national crisis, has stepped up to the plate, putting to use its ability to quickly source among thousands of parts suppliers and ramp up production quickly. Auto makers Ford Motor Co. and Tesla Inc. are also gearing up to boost production.

On March 20, GM officials said they partnered with Ventec, a small maker of ventilators, to begin making machines at its idled 2.6 million-square-foot factory in Kokomo, Ind. The effort will employ about 1,000 U.S. workers, the company said.

Executives at Ventec turned over blueprints for the machines and collaborated with GM purchasing managers to find the more than 700 parts needed for production. Some of those parts needed to come from China, GM officials said.

Factory workers are expected to deliver the first ventilators in April and ramp up to a manufacturing capacity of more than 10,000 ventilators a month.

President Trump's tariffs on Chinese goods have long been unpopular with the U.S. business community, including auto manufacturers. Several business leaders have called for the tariffs to be scaled back to ease the economic crisis that has accompanied the virus's spread.

--Anthony DeBarros contributed to this article.

Write to Katy Stech Ferek at katherine.stech@wsj.com

(END) Dow Jones Newswires

April 03, 2020 17:09 ET (21:09 GMT)

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