General Motors says Venezuela illegally
seizes auto plant
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[April 20, 2017]
CARACAS (Reuters) - General Motors
<GM.N> said on Wednesday that Venezuelan authorities had illegally
seized its plant in the industrial hub of Valencia and vowed to "take
all legal actions" to defend its rights.
The seizure comes amid a deepening economic crisis in leftist-led
Venezuela that has already roiled many U.S. companies.
"Yesterday, GMV's (General Motors Venezolana) plant was unexpectedly
taken by the public authorities, preventing normal operations. In
addition, other assets of the company, such as vehicles, have been
illegally taken from its facilities," the company said in a statement.
It said the seizure would cause irreparable damage to the company, its
2,678 workers, its 79 dealers and to its suppliers.
Venezuela's Information Ministry did not immediately respond to a
request for information.
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Venezuela's car industry has been in freefall, hit by a lack of raw
materials stemming from complex currency controls and stagnant local
production, and many plants are barely producing at all.
In early 2015, Ford Motor Co <F.N> wrote off its investment in Venezuela
when it took an $800 million pre-tax writedown.
The country's economic crisis has hurt many other U.S. companies,
including food makers and pharmaceutical firms. A growing number are
taking their Venezuelan operations out off their consolidated accounts.
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The GM logo is seen in Warren, Michigan, U.S. on October 26, 2015.
REUTERS/Rebecca Cook/File Photo
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Venezuela's government has taken over factories in the past. In 2014
the government announced the "temporary" takeover of two plants
belonging to U.S. cleaning products maker Clorox Co which had left
the country.
Venezuela faces around 20 arbitration cases over nationalizations
under late leader Hugo Chavez.
(Reporting by Joe White and Alexandra Ulmer; Writing by Alexandra
Ulmer; Editing by Edwina Gibbs)
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