NVDA gained a massive 197% since our AI first added it in November - is it time to sell? 🤔Read more

General Motors fires 2,700 in Venezuela after plant closure - workers

Published 24/04/2017, 19:40
© Reuters. The GM logo is seen at the General Motors Assembly Plant in Valencia
GM
-
CLX
-

By Corina Pons

CARACAS (Reuters) - General Motors' (N:GM) Venezuelan subsidiary has sent a message to almost 2,700 staff informing them that they are no longer employed by the company and had received severance pay in their bank accounts, according to two employees.

A Venezuelan court last week ordered the seizure of the company's Valencia plant, ruling in favour of two dealers that had filed a case in 2000 against the subsidiary on grounds they had not complied with an agreed sale of 10,000 vehicles.

Workers say that before the seizure was announced, GM had been dismantling the plant, which has not produced a car since the beginning of 2016 because of shortages of parts and strict currency controls in the OPEC nation.

The seizure, which GM called "illegal," comes amid a deepening economic and social crisis in leftist-led Venezuela that has already roiled many U.S. companies.

"We all received a payment and a text message," said a worker who had worked for the company for more than a decade, adding that his corporate email account had been deactivated over the weekend.

"Our former bosses told us the executives left and we were all fired. There is no longer anyone in the country," added another employee who received the same message on his personal cell phone and a payment to his account. He had been at GM for five years.

The company did not immediately respond to a request for comment about the layoffs or the worker allegations it had already been dismantling the plant.

GM said last week that it was halting operations and laying off workers due to the "illegal judicial seizure of its assets."

'SHOW YOUR FACE'

The leftist government of Nicolas Maduro says it is not seeking to expropriate the plant, which has been operating for 35 years, and has called on GM to come back.

"To the current General Motors president of Venezuela, Jose Cavaileri: You come here, show your face and share with us the options to restore normality," said Labor Minister Francisco Torrealba said Monday.

GM is not the first company to fire Venezuela employees by text message. Clorox (N:CLX) did the same two years ago when announcing its exit from the crisis-struck country, after which workers took over the plant.

GM's plant closure comes after Venezuela's automobile production fell in 2016 to a record low of eight cars per day, according to a local automotive group.

Two union spokespeople said they had no official company information on the layoffs, but said that most workers received the messages along with a bank deposit.

© Reuters. The GM logo is seen at the General Motors Assembly Plant in Valencia

Neither employee would reveal the amount they received but union leaders said it was too low.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.