Monday, 10 July 2017

Venezuela's Car Market Implodes

Super cheap petrol is not enough for many

For most of us, buying a car is a personal choice dependent on need, desire and finances. Spare a thought for Venezuela then. I wrote a blog article about car production there, as seen by clicking here. I couldn't understand the fall in volume, but now I know.

The government's exchange controls are so tight that car makers struggle to pay for parts to assemble them. GM and Ford haven't made cars in 2014 due to this problem and Toyota has decided to cease operations. Car assemblers owe $1.5 billion to overseas suppliers, but cannot pay them. Vehicle sales fell below 300 units last month due to supply issues. Understandably there are numerous other shortages in Venezuela with many basic, essential products.

Despite having the luxury of being an oil exporting country, things are looking dire. Hopefully the situation can be turned around - not just so people can buy cars again - but for the welfare of the people living there.

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