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General Motors has closed down its Venezuela plant after the socialist country seized the plant on Wednesday. Officials swiped the company’s “production facilities and car stock,” which forced GM to lay off 2,700 workers.
The closure comes only a day after Venezuela erupted in more protests that have left at least three dead. President Nicolas Maduro’s policies have left people jobless and without food.
GM’s factory was “unexpectedly taken by the public authorities, preventing normal operations,” according to an emailed statement. The Detroit-based automaker said it “strongly rejects the arbitrary measures taken by the authorities and will vigorously take all legal actions, within and outside of Venezuela, to defend its rights.”
Plant - Place - Protesters - Capital - City
The plant shutdown took place as protesters flooded the capital city of Caracas in the biggest show of opposition to President Nicolas Maduro’s government in months. The auto industry has collapsed, with sales plunging 92 percent in March, as a shortage of dollars has pushed new car prices beyond the means of all but the wealthiest Venezuelans.
GM has suffered a production downfall due the inability to “obtain hard currency to import car parts” since Venezuela has such strict currency controls. GM manufactured 5,052 vehicles in 2015, but did not produce a single one in 2016. The Venezuelan auto industry group Cavenez stated that the company has not produced anything so far this year.
Companies - Cavenez - Chrysler - Ford - GM
Seven companies make up Cavenez: Chrysler, Ford, GM, Iveco, Mack, MMC, and Toyota. Statistics have shown that the group only made 2,849 cars in 2016, which was down 84% from 2015. In 2017, the seven had only made 240 cars. Venezuela houses over 30 million people.
Operating - Venezuela - Endeavor - Years - GM
Operating in Venezuela has been a costly endeavor for years. GM reported charges of $720 million in 2015 and $419 million a year earlier related to currency devaluation and asset impairment in Venezuela.
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