Italy is at the epicenter of the pandemic and its government has embarked on a big expansion of the number of intensive care beds, many of which will require ventilators to keep patients alive by taking over breathing functions.
Siare Engineering, Italy’s largest manufacturer of hospital ventilators, has turned to Italian automakers Ferrari (NYSE:RACE) and Fiat (NYSE:FCAU) to investigate the possibility that the automakers might help produce more of the live-saving machines that are urgently needed to fight the coronavirus pandemic.
The Italian government has asked Siare to increase ventilator production from 160 per month to 500 as the country’s death toll has surpassed 3,400 and is climbing rapidly.
“We’re talking to Fiat-Chrysler, Ferrari and Marelli to try to understand if they can lend us a hand in this process for the electronics part,” Gianluca Preziosa, Siare’s CEO said in an interview quoted by Reuters, adding that the car companies’ expertise in electronics and pneumatics could make them ideal partners. Mr. Preziosa said that another advantage of partnering with the carmakers was their purchasing power, making them more likely to obtain parts that his small firm was struggling to secure amid coronavirus-related disruption to global supply chains.
A spokesman for Exor, parent of both Fiat-Chrysler, aka FCA, and Ferrari, said that meetings with Siare had taken place Thursday to study the feasibility of the idea and that a decision was expected in the coming hours.
The 2 main options were being considered are either to help Siare engineer a capacity increase at its plant, with the support of technicians provided by FCA and Ferrari, or outsource production of ventilator parts to the carmakers’ facilities.
A source familiar with the matter told Reuters that Ferrari would be ready to start manufacturing ventilator parts at its Maranello HQ, which lies close to the Siare factory, but that the iconic Supercar maker had yet to make a final decision.
Automakers worldwide are being drafted for ventilator duty.
In addition to Ford and GM making plans with the US government British Prime Minister Boris Johnson reaching out to Ford, Honda and Rolls-Royce; and Elon Musk tweeted offer to build ventilators “if there is a shortage,” other automakers and aerospace companies are joining in. In Europe, 3 groups have formed.
Ventilators move air in and out of the lungs and could be the difference between life and death for coronavirus patients suffering respiratory difficulties.
“Precision milling and 3D printing techniques could help manufacture complex parts,” said Rene-Christopher Wollmann, program and platform director at Automobili Pininfarina, which uses virtual design software to build electric hypercars.
“But this depends on how much know-how existing manufacturers of ventilators are prepared to share about the design of such a machine,” he added. “Another bottleneck will be assembling such machines under conditions which are adequate for the medical industry.”
European aerospace group Airbus is working across its processes to see if its 3D printing or production facilities can be of use.
Ferrari finished at 136.70, or +2.65 Thursday in NY, and shares were raised to Buy from Hold at HSBC.
Ferrari will continue to create value in the long term. Ferrari is a quality 1st long term luxury products investment, and I have called it at it at 200+/share long term, adjusting it to 200/share short term (after the virus) and siding with BAML to 230 long term for now.
Have a healthy day