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Maria grills 3M CEO on exporting lifesaving medical gear overseas

Apr 09, 2020
Welcome back to more American manufacturers called upon to create

medical

supplies to help protect workers on the front lines of this fight against coronavirus. 3m, which is already in the process of producing 50 million n95 masks, now claims that demand has exceeded production capacity, even after the president. Trump Invoked Defense Production Act Against 3 Million, President Tweeted This Week Saying We Hit 3 Million Hard Today After Seeing What They Were Doing With Their Masks, P-Act Production Act Was A Big Surprise for many in government as to what they were doing. will have to pay a very high price rights the president who joins me right now on the phone is the president and CEO of 3m Mike Roman Mike thank you very much for weighing in here, obviously, you saw, you saw the president's tweet and and the rejection that We are receiving, can you tell us what happened?
maria grills 3m ceo on exporting lifesaving medical gear overseas
Yes, good morning, Maria, and I'm happy to be in this. Yes, and you start with this. Yes, the narrative that we are not doing everything we can to maximize ventilators in our home country is Paul, nothing can. be further from the truth and I'm happy to talk about it, yes, yes, the other idea out there that 3m is not doing everything it can to fight price gouging and unauthorized resale is absurd; We are doing everything we can to fight 19 and support the healthcare workers here at home, but we know that until yesterday we were very proud of all the things we were doing and hearing from everywhere, in every direction, we saved some negative narratives, but the narratives that are out there are just simply not true, okay, let's talk about that here because 3m is one of those few companies in the world right now that everyone is looking at to make sure that can produce what we need in the face of this massive pandemic.
maria grills 3m ceo on exporting lifesaving medical gear overseas

More Interesting Facts About,

maria grills 3m ceo on exporting lifesaving medical gear overseas...

Mike The administration has also requested that 3 million stop

exporting

respirators that can currently be manufactured in the United States. Stop

exporting

them to other countries because we are in an emergency situation right now. Hospitals are on edge and can't even accept them. a heart attack victim a stroke victim because they are overwhelmed with coronavirus cases can you do something that will activate your manufacturing to help your home country in a bigger way? Mike, yes, Maria, we have done just that starting in January, we saw it coming and and We learned in sizes 8 and 1 that we had to keep idle capacity available because we are a leader in this area of ​​respirators, we needed to be ready to step up and that's why we have idle capacity in the United States that we brought online well.
maria grills 3m ceo on exporting lifesaving medical gear overseas
Before there was a call for a coded flight here in the US and we maximized the production of that, that gave us 35 million respirators. We typically produce 16 to 20 million respirators a month in the US, so we have doubled our production and continue to focus. As we ramp up, we have produced millions and billions of respirators and now we have agreed to import molar mass from China. We have an agreement that will allow us to export an additional 10 million just a month out of China and in our normal production going back to even when we started in January, a small percentage, less than 10% of our respirators in the United States, are exported to Canada and Latin America to support healthcare workers there.
maria grills 3m ceo on exporting lifesaving medical gear overseas
We are often the only supplier of those respirators in those countries, so we have with the imports from China, we are importers in that and, as we have been telling the administration, it is in days and it is an understanding, we are happy to send our production abroad to the US, however, its consequences yes, at the manatorial level and that includes stopping exports to Canada in Latin America yes, no, I understand it and Canada and Latin America are in a different place in this time with 19 covered, so the United States is right, I mean the United States has now become an epicenter and an emergency management official in Florida was on Fox News this week and alleges that 3m is sending protective equipment to countries foreigners who outbid buyers.
That official says he realized this was happening when he couldn't buy the essential equipment he needed from distributors and the distributors said, well, we couldn't buy. them because someone else is willing to pay more, so are you selling this equipment to the highest bidder? Mike, we are María, today I left this game, wait, we do not have and would never have these prices for supplies like this, vital supplies in this crisis. We don't sell to the highest bidder, we make respirators, we sell them through authorized distributors and they go there and we sell directly to the government and the distributors take them to the customers when there is greater need and we have been working with FEMA in the US. to ensure that we are prioritizing those with the greatest need now, before we had DEA authorization in early March, we were introducing respirators into our industrial channels in the US and around the world and that those distributors They will sell according to the demand they see, etc.
Much of the resale happening now is a result of inventory as it has built up since the emergency use authorization. We are tracking what we are selling all the way. We are working with our distributors to ensure that they are achieving it and there is not and we are not seeing pricing advice through them, they are resellers that are there where the highest bidder type of problem is happening, so if it really is very , we are in all of this with our team making sure that we are only using authorized sellers and that we are managing that price and preventing price gouging, we are working with a DOJ in the state AGs to aggressively pursue and identify those price universities.
Well, I mean, look, this is really important, obviously, I mean in some markets you are the only producer of respirators and there are some markets where you are the only one making these respirators and we have health care workers who are on the front lines and people who are getting sick in America, so is there a way? that you can make sure that you are not dependent on distributors to sell your equipment that may have been sold to you a while ago to the highest bidder and that you clearly communicate to the American people that you cannot take advantage of a crisis situation, Mike, well. we can be aggressive to help go after those we can identify counterfeits we can identify resellers who are not your eyes distributors work with the DOJ and state AGs to go after them we work with our channel partners because there are no prices from those we are take every action we let's take and PR will bring more of our own production from outside the US to us, as I mentioned, working with China is now codified. 19 outbreaks slow down there, redeploying more of that production and getting approvals to do so and we are working with the White House, yes, to help accelerate that and ramp that up, and we are looking at that as the next step to increase our capacity here.
Well, I'm glad you mentioned China Mike because this is a question I asked you a week ago. when you joined me mornings with Maria on Fox Business because I was told at the beginning of this crisis and I went on air a month and a half ago that they were ships carrying goods that the United States needed important protective equipment that was made in China and those Ships were told to turn around because China needs the equipment and those contracts that were in place with American companies. American hospitals weren't going to get the gloves, we're not going to get the masks.
Clay has its factories. on the ground in China, if XI Jingping decides to tell you Mike Roman, well, your factories are in China, you are going to make everything for China and no, we are not going to send anything to export to the United States. I have to listen to it well. I mean, you're dealing with the communist country and it's more than just China. We have seen export restrictions on PPE and in various places around the world and those are the risks and moving forward with this and that is why I have been working with the administration and with others to try to work positively and get it done. open up the opportunity to move goods to where they need to be, so there are export restrictions in the EU, their export restrictions in various parts of Asia and we have, we have I've been working on it since all of fucking January, so which is something difficult to handle.
China has now opened up exports, so we have the capacity and are working with the administration to add greater availability of exports and get approval to bring them in. products that aren't always standard products from us, but they can still help, we need to get approval to bring them to the US and that's all accelerating and as you know, we're excited to be working on going from 10 million to more. we can, but this is a really important point because a lot of companies like 3m have operations in China, but when we are in the middle of a crisis in the United States, what are you going to do if the Chinese government tells you that there will be no export, you have export restrictions, I mean, you have an established procedure to produce products for the local economies that you operate in and that is what you have been doing by producing products in China for the Chinese, but when the United States has a major crisis situation in the one we're in now, where our healthcare workers can't have access to that, what are you going to do?
Will you rethink any of your supply chains now that we're in this crisis and you see what's happened at home? America and Maria, our Auto and 3m has always been to produce clothing for the market, we go local by local and that includes us and we are a net exporter outside the US with production, we have your pulley process, old product in respiratory, we have a model for producing here in the Americas and now we are expanding capacity, we are reconsidering that, frankly, what kind of capacity do we really need to meet demand, we have demand that is more than we can meet in our production today, we are adding capacity which we have increased to 35 million in the short term we will get the 50 million per month in June and it will be within 90 million respirators per month at the end and we have investments to increase from there also to meet what we see as an into mestiço we clearly did not have the capacity to assume the levels that kovat 19 has demanded and we are not alone, we are not the only company in this market, but we are an important supplier and we are rethinking that and right now investing not only to expand in order to to April and May but to be ready as we move forward, we have responded to the US government's RFP for 500 million ventilators and we were awarded part of that where you know we have to be ready to deliver on that and then we'll look at it from there, but we're definitely stepping up as we get closer to the deadline and through the NBA?
So if you say you were doing everything according to plan and trying to meet the capacity that's going up, why do you think the president had to use the defense production act at 3 million? Well, he has focused on defensive production. I would say that we have been telling the administration for days and days and it is important to understand that we are happy to move our

overseas

production to the US, we are already in that importer, but there are consequences, as you highlighted, to We are often the only provider of healthcare workers in many countries and that was the way we built.
We've deployed this capability around the world to be able to support them, so there will be consequences: they won't have access to the product and they're in the middle of this cove in 1952, so we're happy to do that. It will comply with the DPA that It was important that we had the DPA, so it really helped us go after that very aggressively because of those consequences on a humanitarian level and then the United States exports to Canada. This challenge we are, we are often the only provider of healthcare providers in Canada. It is important that if we are going to stop those exports that we all understand the consequences and the DPA has given us that clarity and we will comply, so what do you think the consequences will be if the US does not obtain the adequate number of respirators, ventilators and equipment of protection like masks and gloves if millions and millions of people in America die Mike, yeah, we are, we're all doing everything we can, like I said, bringing everything we can and it's It's hard for us to play God, really We are working to make the best decisions.
We're partnering with FEMA in the US and printing where the government really helped us navigate this. We are doing everything we can in our power to maximize production. an example, you are not the only company here, but we take this to heart, we have 96,000 Cassidy Mike, do you think you have theability to produce enough masks, RESPA gloves and respirators at this time? Well we produce PPE, we produce respirators, we don't produce gloves and we have a small amount of mass that we have been importing and we have also been challenged so it really is respirators for us in n95, now the famous n95 respirator and that is the focus, well Right?
We work with you, you know? There are other suppliers and those other categories, so do you think you have enough product right now to meet the needs of American healthcare workers right now? Really I do not think so. One of the challenges is analyzing demand to usage, I think. We have visibility with other companies and with ourselves and we are improving our ways so that we can meet the immediate need and we have to make sure that we are on that, providing respirators where they are used, without putting respirators in inventory. Somewhere without them entering the channel and certainly without anything entering the resale channels, we are our focus authorized distributors, these are our big six reputable companies in the US.
We are working in partnership with them and to make sure we achieve that, I think "We can contribute to that, together with the other companies and with the help of the DPA, and they will work to expand our exports from China, we will bring more to the market and we will manufacture a larger part of the ship," he said President. that a high price will have to be paid. Have you spoken to President Mike? We have been in contact with the administration but I have not spoken directly with the president. No, Mike. Thank you very much for addressing this very important topic.
We greatly appreciate your time. today thank you sir very good thank you Maria

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