GM halts operations in Venezuela after factory is seized

The GM logo is seen in Warren Michigan

The GM logo is seen in Warren Michigan

The Venezuelan government has offered no explanation for its seizure of the GM plant, and the timing of the move suggests Maduro may be looking to escalate his confrontation with the United States to try to move attention away from the intensifying protests against him.

A statement issued Thursday by spokesman Stephane Dujarric calls on the Venezuelan government and opposition to "engage sincerely to reactivate dialogue efforts, " especially on issues such as the balance of power among branches of government, the electoral calendar, human rights, truth and justice and the country's socio-economic situation".

GM has been the market leader in leftist-led Venezuela for over 35 years.

Other automakers have struggled in the country as it has become more hard to access USA dollars and import essential mechanical parts.

Last May, tire maker Bridgestone sold its business there after six decades of operating in the country.

The company called on workers, suppliers, dealers and external operators to refrain from reporting to work at the plant or other jobs until the court ruling is reversed.

In July 2016, Venezuela's government seized a factory belonging to the Irving, Texas-based personal care giant after the company said it was no longer possible to manufacture there due to a lack of materials. President Nicolas Maduro accused Kimberly-Clark of participating in an global plot to damage Venezuela's economy.

CARACAS, Venezuela-General Motors Co., the world's third-largest auto maker, said it has stopped operating in Venezuela following the expropriation of its plant.

The automaker suspended operations at its Valencia, Venezuela, plant in December due to slumping sales.

GM can seek compensation and damages for its lost plant in several different worldwide venues, said Nigel Blackaby, a lawyer at the Freshfields Bruckhaus Deringer law firm, which has battled Venezuela in several high-profile cases in global courts.

Dealers will continue to service vehicles and provide parts, the company said.

ExxonMobil pulled the plug on its operations in Venezuela in 2007 after former President Hugo Chavez attempted to nationalize one of its projects.

South American operations, which include Venezuela, account for a relatively small portion of GM's earnings and sales. Past year the company lost $400 million before taxes in South America, but as a whole the company made a pretax profit of $12.5 billion.

Shares of General Motors Co. rose 32 cents to $34.11.

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