Tags: Venezuela | Chavez | Threat | Oust | Toyota

Venezuela's Chavez Threatens to Oust Toyota

Monday, 28 Dec 2009 11:16 AM

Venezuela's President Hugo Chavez has threatened to expel Japanese carmaker Toyota unless it produces an all-terrain model of 4x4 vehicles used for public transport in poor and rural areas.

The fiery socialist, in a speech late on Wednesday, also said he would not hesitate to expel and expropriate plants from other Asian and U.S. automobile companies operating in Venezuela if they failed to share technology with locals.

"What's this that Toyota doesn't want to make the 'rustic' model here?" Chavez said, during a ceremony in Caracas to hand owners the keys to economically produced cars that Venezuela's government has imported from Argentina.

"We must force them. And if they don't, then they should leave and we'll bring another company in ... The Chinese want to come and they make 'rustic' models."

During a decade in power, Chavez has nationalised large swathes of the Venezuela economy — including the oil and power sectors — as part of his "21st century revolution" but has so far left car manufacturing relatively untouched.

He turned on Toyota, the world's biggest automaker, when a transporter said there was a scarcity of all-terrain models to serve people in under-privileged areas.

Caracas' poor mainly live in hillside slums, while many rural areas lack decent roads, meaning tough 4x4s are the main means of transport.

Chavez ordered his Trade Minister Eduardo Saman to carry out a "severe inspection" of Toyota, and warned other companies they must start sharing technology with Venezuelans.

"You tell the people at Toyota that they have to produce this model and we are going to impose a quota, and if they don't meet it, we will punish them," he told Saman, adding that the state would not hesitate to expropriate Toyota's facilities and pay appropriate compensation.

Following Chavez's speech, Toyota has asked the Japanese government to verify the true intentions of his remarks as he has not contacted the company on the issue, Toyota's Tokyo-based spokesman Yuta Kaga said on Friday.

Spokesmen for Toyota's Venezuelan unit, which operates an assembly plant in the eastern state of Sucre, were not available to comment on Thursday.

But a source at the company said Toyota had stopped assembling the model in question — which he identified as Land Cruiser 70 — in 2007, with the government's full knowledge.

It planned to import instead, but had not received the necessary licence, he added.

"The government was informed, it can't be a surprise," the source said, adding that most Toyota managers were on holiday but were communicating with each other about Chavez's speech.

In addition to Toyota, Japan's Mitsubishi as well as Hyundai and General Motors  have assembly plants in South America's top oil-exporting nation, whose people are known for their love of cars.

"Companies who come here to set up must be ready to transfer technology to us," Chavez said.

"If they don't want to, they should go away. I invite them to pick up their things and go," he added, saying companies from allies like China, Russia, Belorussia and Iran were ready to take their place.

Lack of access to dollars at the official exchange rate, and labour disputes, have combined with a recession to hit the automobile industry hard in Venezuela this year.

According to latest figures from the Venezuela Automobile Chamber, car sales in November were down 40 percent at 10,075 units, compared with the same month last year.

© 2017 Thomson/Reuters. All rights reserved.

   
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Venezuela's President Hugo Chavez has threatened to expel Japanese carmaker Toyota unless it produces an all-terrain model of 4x4 vehicles used for public transport in poor and rural areas. The fiery socialist, in a speech late on Wednesday, also said he would not hesitate...
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2009-16-28
Monday, 28 Dec 2009 11:16 AM
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