President Donald Trump has invoked the Defense Production Act to force Minnesota-based 3M to focus all of its efforts on producing N95 respirator masks for healthcare workers as the novel coronavirus tightens its grip on America.
The executive declaration rules that 3M "shall use any and all authority available under the Act to acquire, from any appropriate subsidiary or affiliate of 3M Company, the number of N-95 respirators that the Administrator determines to be appropriate."
Maplewood-based 3M says that the order stipulates that the company stops exporting U.S.-made masks to its Latin America and Canadian markets, and increase exportation of masks from overseas plants to the U.S.
It comes amid an ongoing shortage of personal protective equipment (PPE) for healthcare workers in the U.S., which now has more confirmed cases of COVID-19 than any other country.
President Trump tweeted that "We hit 3M hard today after seeing what they were doing with their masks," adding that they'll "have a big price to pay."
The president has not elaborated on what 3M was doing to deserve punishment, but there have been reports about tensions between his administration and 3M this week.
The Financial Times reported that 3M resisted White House demands that it ship 10 million N-95 masks it produced at its Singapore factory for Asian markets back to the U.S., with the company citing humanitarian grounds for its refusal due to the demand for masks in its Asian markets.
Then on Thursday, Florida's Division of Emergency Management head Jared Moskowitz, gave an interview to Fox News in which he alleged that 3M has been shipping the masks to foreign countries that have outbid the U.S.
"They're specifically saying, 'Listen, we are sorry your order got pushed down, but ... there are foreign countries who do business differently and they're showing up with cash,'" Moskowitz said.
3M says order could mean fewer masks in the U.S.
3M issued a response Friday morning, not commenting about sending masks to higher bidders, but saying that "there are significant humanitarian implications" if they follow the Trump Administration's request to stop exporting respirators to Canadian and Latin American markets.
Doing so, 3M says, "would likely cause other countries to retaliate and do the same, as some have already done."
"If that were to occur, the net number of respirators being made available to the United States would actually decrease," the company said.
The Maplewood-based manufacturer and others are producing about 50 million N95 masks a month, according to the Wall Street Journal, which is far short of the 300 million masks the Department of Health and Human Services estimated American healthcare facilities would need each month to safely battle the pandemic.
Mike Roman, CEO of 3M, told the Journal that the global demand "exceeds our production capacity."
President Trump also used the Defense Production Act on six other medical device-makers, including Medtronic, which is now based in Ireland but retains a significant in the Twin Cities.
A spokesperson for Medtronic told Politico that it “is working to ensure that ventilator manufacturers, such as Medtronic, have the necessary supplies we need to continue to increase our production of these critical products.”