By on April 21, 2017

[Image: Wikimedia Comonns]

As Venezuela descends even further into economic and social turmoil, and as mass demonstrations turn violent, we learned yesterday that General Motors’ Valencia assembly plant is no longer in the hands of General Motors.

The plant, which has sat idle for months, was “unexpectedly taken by the public authorities, preventing normal operations,” the automaker stated. Supposedly, the reason for seizing the asset lies in a 17-year-old lawsuit filed by a disgruntled dealer group angry over torn-up contracts. The dealers wanted billions of dollars in compensation — a sum that GM said “exceeds all logic.”

A new report has shed more light on the automaker’s situation, revealing that the government wasn’t the first group to seize the factory and bar the doors.

It was members of one of the GM subsidiary’s unions who first took over the plant, the New York Times reports. A spokesman for General Motors Venezolana said yesterday that the facility had been in the hands of the union members for 42 days. When GM appealed to the government to help end the seizure, Venezuela took the plant for itself, he said.

Company managers are no longer allowed in the building, though union members are.

For years, Venezuela’s increasingly autocratic government has expropriated private businesses in a bid to nationalize vast sectors of its economy, prompting many foreign companies to pull up stakes. GM is only the most recent casualty. Following the seizure, the company has announced the “immediate cessation” of its operations.

As imports into the country dried up, oil prices fell and the country’s currency plunged, food and supply shortages skyrocketed. Of course, anyone with a grasp of world history knows how quickly empty plates can lead to Molotov cocktails and tear gas. The increasingly dire situation has also led to empty driveways. Vehicle sales in Venezuela fell from 112,000 in 2012 to 3,375 last year, according to IHS Automotive data.

Stephanie Brinley, senior analyst for IHS Automotive, told the Detroit Free Press that the General Motors Venezolana plant hasn’t produced a vehicle since 2015. Fiat Chrysler Automobiles, which still maintains a factory in the country, built 37 vehicle last year.

In a statement, GM said it would use all legal resources to “defend its rights.”

[Image: Wikimedia Commons (CC BY-SA 3.0)]

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36 Comments on “After Car Buying Became Impossible, Union Members Seized GM’s Venezuela Plant: Report...”


  • avatar
    Felix Hoenikker

    The lost auto production from this plant will be replaced by stolen cars transported from the US and Mexico in shipping containers. Oh wait, that’s Columbia!

  • avatar
    operagost

    How long before Venezuela is Cuba? It’s about 80% Cuba right now, except the difference is this time the socialists are already in power.

    • 0 avatar
      SCE to AUX

      I think the Cubans have lived in relative peace for the last 50+ years, which is why the Castro regimes could endure.

      Mr Maduro is starving his own people through Really Bad Economics, and that will end poorly for him.

      Neither the Cubans nor the Venezuelans have been brainwashed like the North Koreans, who live in squalor and think it’s normal.

      • 0 avatar
        Garrett

        Cuba had the Soviet Union to help support them. Best Korea has China’s support (for now).

        Never go full socialist unless you have someone else helping you pay for it.

        • 0 avatar
          TMA1

          There was a time, decades ago, when the “Korean economic miracle” referred to North Korea, while the South Koreans lived in squalor. That ended when the USSR stopped underwriting their economy.

  • avatar
    chris724

    Countdown ’til the resident leftists show up… 3, 2, 1…

    • 0 avatar
      OldManPants

      Yeah, well, if it weren’t for leftists what would all those guys in helmets do for a job?

      • 0 avatar
        SCE to AUX

        True.

        And another thing: I’ve always wondered where disgruntled protesters get rocks and bottles to throw. Such a protest in my neighborhood would be very short-lived, as there’s nothing available to throw at The Man.

    • 0 avatar
      Lou_BC

      Three rights make a left.

      That does explain some of the policy flipflops we’ve seen in the White House.

      • 0 avatar
        chuckrs

        Lou

        Chavez/Maduro have been screwing things up for 228 months. President Trump has been in office for 3 months. Now you might think he is some sort of miracle worker, but I doubt he could have had much if any impact on Venezuela in that period of time.

        • 0 avatar
          28-Cars-Later

          228 months later…

          • 0 avatar
            Lou_BC

            @28 –
            I am surprised that the USA isn’t getting involved in Venezuela. The USA has always seen the Americas as their exclusive sphere of influence.

          • 0 avatar
            28-Cars-Later

            Monroe Doctrine and all.

            I seem to recall Chavez claiming there was a failed CIA coup against him in 2002 or 03, which is probably accurate. Then again the State Department was busy executing the Yinon plan last six years so maybe South America got off light till recently.

        • 0 avatar
          Lou_BC

          @chuckrs –
          “Now you might think he is some sort of miracle worker”

          Thanks.

          That was funny.

  • avatar
    JimZ

    “The plant, which has sat idle for months, was “unexpectedly taken by the public authorities, preventing normal operations,””

    “which has sat idle for months”

    so, no problem?

    • 0 avatar
      NoID

      It’s no problem so long as GM is no longer on the hook for maintaining and paying taxes on an idle property. But if/when the tides change in Venezuela and it’s time to do business again it will be a problem once more.

  • avatar
    RedRocket

    GM should have rigged explosive charges in key parts of the plant and set them off by radio control.

    • 0 avatar
      cdotson

      I know, right? Don’t know what GM thinks “legal resources” to defend its rights are. They’d do the world a favor if they went all-in with a handful of private military contractors to take back what’s theirs and teach the expropriators not to attempt it again.

      I somehow doubt that’s a financially prudent move.

    • 0 avatar
      George B

      GM should have filled the plant with stuff they were trying to get rid of like returned lemons, unwanted inventory, and toxic waste. It was inevitable that this plant was going to be seized, so GM might as well have used it as a dump.

  • avatar
    SCE to AUX

    “anyone with a grasp of world history knows how quickly empty plates can lead to Molotov cocktails and tear gas”

    …and a rope for the country’s leader. That’s my prediction.

  • avatar
    Corollaman

    Maybe the people will go in there and start building cars for the people to have for FREE, isn’t that what socialism is all about, Bernie?

    • 0 avatar
      kurkosdr

      Doubt it. Anyone with marketable skills, such as knowing how to run a factory or assembly line skills, has already left the country, so even if the Maduro government finds a way to get the raw materials, they won’t have the personnel to actually make cars.

      See, people with marketable skills actually have places to go if they decide to leave the country, so if some government tries to “expropriate” 80% of their income to pay for the fat state pensions and fat state salaries of the nomenclature, those people leave the country.

      This is what happened in Venezuela. The only people left in Venezuela are farmers hiding production from the government (and instead selling it to neighboring countries at higher prices than the ridiculously low set prices the Maduro government demands) and people who have nothing.

      Which is why Socialism is the worst system for low-skill workers. The high-skill people leave and the low-skill people are left behind to feed some mustached dude’s nomenclature.

      • 0 avatar
        OldManPants

        nomenklatura

        • 0 avatar
          Lou_BC

          OldManPants – he got socialism wrong so how do you expect him to get nomenklatura right?

          • 0 avatar
            OldManPants

            Yeah, he sounds like a young alt-righter and that’s no crime, certainly just as many vapid, dorky young alt-lefties.

            But “nomenklatura” was such a defining and iconic feature of the Soviet system and a word so bandied about in the West during its waning days that I felt obliged to get a little pedantic for the sake of someone probably not yet born then.

          • 0 avatar
            Lou_BC

            Perhaps he can just blame spell check since there is always some sort of “alt way” out these days.

          • 0 avatar
            28-Cars-Later

            Nomenklatura, so that’s what its called. I think we still have that in what remains of the West.

          • 0 avatar
            chuckrs

            How about a porte-manteau?

            Nomenclature = Nomenk(latura) + (Legis)lature

            Delete the bracketed syllables and elide the rest.

            Works for me – my state legislature and the federal Congress are certainly, in their own minds, members of a nomenklatura.

        • 0 avatar
          Salzigtal

          Do we in the 1st World get to skip HyperNormalisation?


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