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.

Topics: ford, production

If you liked the article, share on:

Comments

Recommended

The first time Porsche revealed the Panamera Sport Turismo to the public was during the 2017 Geneva Motor Show earlier this year. And now it has already entered production, and...
by - July 27, 2017
Autocar has got some juicy rumours for us regarding a new McLaren hypercar. The British publication has inside sources claiming that a new model will be added to the Ultimate...
by - July 27, 2017
Ferrari has recently launched the New Power15 extended warranty program. The company developed this program in response to the notion that supercars are very expensive to maintain. Truth be told,...
by - July 27, 2017
The UK it seems is about to take the same road as its neighbouring country France by banning sales of petrol and diesel vehicles beginning 2040. As reported by The...
by - July 27, 2017
What has BMW been up to lately? The company recently announced that they are currently focusing on electrification, and so far, their new architecture will enable “electrification of every model...
by - July 26, 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