Ford stops output in Venezuela due to parts shortage

Article by Christian A., on May 7, 2014

Ford Motor Co. stopped building vehicles at its Valencia site in Venezuela this week until the end of May as the United States dollars needed to import parts were not adequate in the country, plant workers told Reuters. Carmakers, as well as other private businesses in Venezuela, have been complaining about the government’s currency exchange controls are preventing them from importing needed products.

Venezuelan Transport Minister Haiman El Troudi confirmed the work stoppage at the Ford plant, but remarked that the site would reopen in two weeks following a meeting between the carmaker’s representatives and government officials that resulted to resolution of some "critical bottlenecks."

El Troudi said that state currency board Cencoez would release $20 million in debt to Ford this week. Japanese carmaker Toyota Motor Corp. stopped vehicle assembly in Venezuela in February over the same reasons.

The auto industry in Venezuela posted a 76-percent drop in production in the first quarter of 2014 to just 3,424 vehicles, according to national automakers' organization Cavenez.

Auto output in the same period last year was 14,316 units. As for Ford, it only produced only 499 cars in Venezuela in the first three quarter 2014. The government of Venezuelan President Nicolas Maduro is facing increasing pressure to release more dollars for imports.

Maduro has claimed that unscrupulous businessmen overstress needs just to flip dollars on the black market for profit. His ministers, however, are holding urgent meetings with business leaders in order resolve issues and help reverse the slump in local auto production.

The country operates three exchange controls -- at VEB6.3 per dollar for preferential goods, and at around VEB11 and VEB50 for other sectors via two Central Bank mechanisms. According to illegal Web sites that track trading of the currency, the dollar is trading at around VEB66-VEB68 on the black market.

If you liked the article, share on:

Topics: ford, production

Comments

Recommended

Before the W177 goes on sale in 2018, Mercedes-Benz had to go back to the drawing board to check on the A Class’ interior. This is because the new model...
by - November 24, 2017
If you see the Aston Martin’s 2018 Vantage, you would think that it is significantly different from most of Aston’s GT lineup. For instance, if the DB11 is a fine...
by - November 24, 2017
Even as Chevrolet is making a huge splash in the industry with the recent launch of the new Corvette ZR1, there may be trouble brewing. Chevrolet has announced huge discounts...
by - November 24, 2017
The 2018 GMC Sierra 2500HD has arrived this week at the snowy mountains in Colorado for its winter long debut. GMC’s tracked Sierra Mountain Concept will be on display at...
by - November 24, 2017
We’re willing to bet that the Bentley Bentayga is not the first thing that comes to mind for most people who are into off-roading and outdoor activities. It just doesn’t...
by - November 23, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries