Venezuela’s, well, President Hugo Chavez took a page out of the U.S. government’s playbook, and ordered Toyota’s local assembly plant to make more cars, pronto. If the Japanese don’t produce an adequate number of vehicles designed for rural areas, Chavez will expropriate Toyota and kick them out of Venezuela.
According to this morning’s indignant Nikkei [sub,] Chavez said his socialist government is going to apply strict quotas on the number and types of vehicles firms can produce. He ordered an immediate inspection of Toyota’s facilities to see how many “rustic vehicles” they are currently producing. (“Rustic,” not “rusty.”)
“They’ll have to fulfill (the quotas), and if not, they can get out,” said Chavez during a televised address. “We’ll bring in another company.” And what company would that be?
Chavez said if it turn out that Toyota is not producing what he thinks Toyota should produce, his government may take over the facilities and have a Chinese company operate it.
“We’ll take, we’ll expropriate it, we’ll pay them what it’s worth and immediately call on the Chinese,” Chavez said. Chinese firms, he said, are willing to make vehicles made for the countryside.
Toyota’s assembly plant in Venezuela has more than 2,000 workers, and has been in this Venezuela for more than 50 years. Methinks the Chinese government will think twice about accepting the Venezuelan invitation. The Chinese parts industry is heavily intertwined with Japan. Chinese state-owned automakers are engaged in joint ventures with Toyota and other Japanese makers. Previously strenuous Sino-Japanese relations are thawing, and won’t be risked for a banana state that happens to sit on oil. Toyota drivers, don’t buy your gas at Valero to show support to your brand.