Venezuela’s Auto Industry Stalls

Continuing currency problems have cut output by Venezuela's auto industry more than 80%, The Wall Street Journal reports.

The newspaper notes that the inability of producers to get U.S. dollars with which to pay for imported parts shrank Venezuela's output of passenger cars from 36,900 in the first six months of 2013 to 6,200 in the same period this year.

Full-year car sales in Venezuela plunged to 99,000 units last year from a peak of 492,000 in 2007, the Journal notes. It says the shortage of new cars has roughly quadrupled used-car prices over the last five years.

Talks with Venezuela's government to ease the shortage of dollars have dragged on since last autumn with no result. In April, General Motors, Ford and Chrysler took first-quarter losses as they downwardly adjusted the exchange rate for Venezuelan bolivars. The companies also warned of continuing losses in the country.

An unsympathetic Venezuela President Nicolas Maduro blames the auto industry's woes on carmakers. He accuses them of selling overpriced parts and colluding with his political foes to destabilize the government.