Auto Production Plunges 83 percent in Venezuela
EspañolA report released on Tuesday by the Venezuelan Automotive Chamber (CAVANEZ) revealed vehicle production in the country has dropped 83 percent in the first half of 2014 compared to levels in 2013.
Midway through 2014, only 6,161 vehicles have been manufactured compared to the 36,919 that were produced during the same period in 2013.
These numbers signal the Venezuelan auto industry’s worst year, assembling less than one-sixth of what was produced last year. Three of its seven plants (Chrysler, Iveco, and Mack) are closed, and the other two (Ford and General Motors) are struggling to assemble any vehicles at all, given the lack of imported materials and restrictions on international currency.
Since 2003, government policy has placed currency exchange under tight control, which forces companies to ask the government for permission to buy the US dollars they need to operate at firmly regulated prices.
Only two of the seven plants, Toyota and MMC Automotive, have managed to raise their numbers slightly in June. President Maduro’s administration has held various meetings in Venezuela with local automobile production representatives to help resolve its US$2.8 billion debt, part of which can be attributed to the government’s delay in liquidating official currency to the sector.
This production crisis means that Venezuelan car dealerships face nearly empty parking lots, able to supply a very limited quantity of vehicles for which customers must often wait up to a year to purchase.
Venezuela has the largest oil reserves in the world and is the country’s main source of income. However, the country imports most of the food and other goods it consumes.
Source: El Universo.