Venezuela's Chavez threatens to kick out carmakers

[Magda Hassan]

Venezuela's Chavez threatens to kick out carmakers


Toyota's plant in Venezuela has more than 2,000 workers

Venezuela's President Hugo Chavez has told car companies they must share their technology with local businesses or leave the country.
Mr Chavez gave the ultimatum to Toyota, Ford, General Motors and Fiat during a public address.
If the demand isn't met, he said: "I invite you to pack up your belongings and leave. I'll bring in the Russians, the Belorusians, the Chinese."
Venezuela has nationalised most of the oil, metal and coffee industries.
Mr Chavez attacked Toyota in particular, saying it was not producing enough four-wheel drive vehicles, which are used for public transport, and ordered an investigation.
So far, the carmakers have not responded.
Last year, car plants in Venezuela produced 135,042 cars and trucks.
Currency controls in Venezuela mean the industry is struggling to get enough money to import parts and pay off debts.

http://news.bbc.co.uk/2/hi/business/8429427.stm

[Ruben Mundaca]

Seems another excuse for "nacionalization" or to put his "friends" instead.

How a carmaker can "share" his technology with local businesses?... are there local businesess making cars too..?.. If so, can any company have the will to share what make them sucessfull against his competitors?...

Car technology is easy to archieve. Any mechanics with basic skills and mechanics engeneers can dismantle a car and reverse engeneer. Its not rocket science. Many countries (China and South Korea, for example) has done that, but a basic industrial infraestructure is needed to comercially built a car (or a truck) as foundrys and metalworks.

As far I know, Venezuela has little developed those areas, and their cars are builded from parts that come from around the world. Very few countries produce evreything needed to build a car, because the scale production economy. If somebody want to produce high tech products, things gets even worst. World production is inter-dependant now. And if Chavez place his friends instead, things will not change a lot.

Real problem is how to do that in a cheap and quality way in order to be profitable, if the product is attractive to the costumers, if the product has enough customer support, etc. etc.

[Magda Hassan]

I don't trust the BBC to accurately report anything about Chavez. It would seem to me that he wants the car companies to source their parts from local manufacturers to support local business not import them from overseas. Seems reasonable to me. The car makers are hopeless at meeting real needs.

[Ruben Mundaca]

If that is correct, then will be very difficult for ANY serious carmaker to accomplish Chavez's desires.

A carmaker can guarantee the quality and well-functioning of a car IF that car use the parts and brand wich was designed and test it. Any variation (for example, an electricity delivery variation or even the size and weight of a piece) can change the standard functioning of the entire machinery.

So, the car company can't guarantee the right functioning of the car, and so the insurance company will have serious doubts to assure that car. It's a chain of events.