Venezuelan authorities have seized the General Motors plant there and GM has responded by ceasing all operations in the country. Calling the seizure of its assets illegal, a GM announcement says that the actions by the Venezuelan government have caused irreparable damage to the company, its 2,678 workers, its 79 dealers (comprising 3,900 workers), and its suppliers (which comprise over half the automotive parts industry in Venezuela).
As a consequence, GMV announces the immediate cessation of its operations in the country, and ensures (as far as the authorities permit) payment of the employees’ separation benefits arising from the termination of the employment relationships due to causes beyond the parties’ control.
GMV strongly rejects the arbitrary measures taken by the authorities and will vigorously take all legal actions, within and outside of Venezuela, to defend its rights.
An economic crisis in Venezuela has been brewing for some time, culminating in protests, violence, and government seizure of assets in an attempt to service heavy foreign debt amid falling world oil prices. Several other iconic American companies, including Coca-Cola, Ford, Proctor and Gamble, and others have also ceased operations or scaled back to near-zero.
The seizure of GM’s assets, however, is the first well-publicized seizure of a large foreign corporation’s assets outside of the petroleum industry.