It was not a ‘Goodyear’ for multinationals in Venezuela

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The prestigious tire company Goodyear announced last week that it would abandon all its operations in Venezuela, joining other multinationals

"C.A. Goodyear of Venezuela (" GdV ") has been forced to cease operations at its factory located in Valencia, Carabobo State." This is what the statement says, and that is still available on the website of one of the largest tire manufacturers in the world. The company, founded more than 120 years ago, would have left Venezuela due to the difficulties brought by the economic crisis and the sanctions imposed by the United States.

Leer en español: No fue un ‘Goodyear’ para las multinacionales en Venezuela

"Our goal was to maintain operations (of the factory), but the economic conditions and the sanctions of the United States have made it impossible", claims a statement quoted in Reuters.

Perhaps the strangest thing of this case is that among the compensations granted to the employees, and in addition to an extra economic bonus, Goodyear has decided to distribute 10 new tires for each worker. This decision probably arises from the need for the brand to get rid of existing inventory, but it also has to do with the devaluation of the bolivar, which makes economic compensation not much useful.

Now, the Venezuelan government is in the process of criminal investigation of the Goodyear directives forcing them to reopen the factory, which was impossible to maintain. According to an official statement published in the newspaper El Universal, the government of Venezuela considers the closure of the factory illegal and "an act of sabotage and boycott."

It was not a 'Goodyear' for multinationals in Venezuela

Goodyear's case is only the most recent in what is already becoming a marked trend of the Venezuelan market and one of the most serious consequences of the crisis that drowns the country.

Another tire company, Pirelli, closed its factory in Valencia, Venezuela, at the end of August of this year due to the continuous lack of raw material to make its products. Many of the workers at the factory knew that it was going to close, but they were surprised when it finally closed without any warning.

The general secretary of the union, Luis Álvarez, told the newspaper Expansión de México that the decision was taken unilaterally and without consulting the employees. He also assured that in its last year, the factory produced 80,000 tires, barely 6% of the 1.2 million that they produced previously.

In October of this year, Colgate-Palmolive hygiene products firm also had to close factories because of the unfavorable business situation. The reason for the closure was the absence of cardboard, necessary to manufacture the packaging of their products. The factory, which produced detergents, received cardboard from the company Smurfit Kappa, but after the government took control of this company, cardboard became scarce.

Also read: There are no boxes! Colgate-Palmolive suspends operations in Venezuela

This factory, the second to close of the 5 that Colgate-Palmolive has in Venezuela, was also located in Valencia, Carabobo State, in the north of the country.

Kellogg's was also another multinational that left the country. When announcing its departure from Venezuela, the government appropriated its facilities, assuring that they would grant control of the fabric to the workers so that they could "continue producing for the people."

As in the case of Goodyear, the government also accused Kellogg's of an unconstitutional departure from the country. President Nicolás Maduro announced that there would be judicial persecution of Kellogg’s executives; assuring that its departure was part of an "economic war" ordered from Washington.

Besides, the main closures of this year in Venezuela, there were other important companies that left the country, such as:

• Kimberly Clark, the hygienic and paper products company, which was expropriated in 2016
• Clorox, of cleaning products, closed in 2014
• General Mills, also of cereals, in 2016
•   General Motors, of automobiles, ended up expropriated last year

LatinAmerican Post | Pedro Bernal

Translated from: 'No fue un ‘Goodyear’ para las multinacionales en Venezuela'