New Medtronic (NYSE:MDT) CEO Geoff Martha openly disagreed yesterday with President Donald Trump’s mission to bring formerly U.S.-based companies back to this country, according to a report in the Irish Times.
Medtronic, which maintains a U.S. headquarters in Fridley, Minn., bought Dublin-based Covidien for $50 billion in 2015 and moved its global headquarters to Ireland in a move critics cast as an attempt to avoid higher U.S. taxes. In the wake of distribution and supply chain disruptions caused by the coronavirus pandemic, Trump has been calling for formerly U.S.-based companies to come home.
Martha said such “reshoring” is not the answer, according to the Irish Times article. “We all recognize that supply chains are globalized,” Martha told the newspaper. “It is not just where you manufacture. Take our ventilators which we make in Galway, for example. The ventilator has around 1,600 parts that come from suppliers in 14 different countries. The minute the U.S. does that [reshores], the question is what does the EU do, what does Ireland do, and it can create a lot of challenges for the global economy.”
Medtronic should make contingency plans in case the U.S. government forces it to manufacture more here for the domestic market, Martha said, adding, “but I hope it doesn’t come to that.”