General MotorsOpinionPolitics

Venezuela takes over General Motors plant; highlights risk of building abroad


If you haven’t read already, the Venezuelan government arbitrarily took over the General Motors assembly facility there, and GM is pulling out of all their Venezuelan operations. This is a prime example of why it is risky to have production operations in a foreign country.

When President Trump was running for office, he made it clear that cars sold in the United States would be built in the United States if he had any say in the matter. While it might logically make sense for General Motors or Ford to build here — they’re U.S.-based companies — it would also mean that foreign manufacturers would have to risk their production operations on foreign soil.

Unlike Venezuela, the United States government is stable and our currency is solid. While there might be more political unrest here than there has been in decades, it’s nothing like what is happening in other parts of the world.

It’s not beyond the realm of possibility of something like that happening here, though, and when a company looks at building a plant in a new country they look at all possible scenarios of what could happen. It’s not just making sure there’s a good workforce that makes a quality product, but also making sure the government is stable so there aren’t potential issues. If suddenly the U.S. found itself at war and needed tanks, would they take over a foreign-owned production facility to make those tanks?

Is that actually likely to happen here? No. But when talking about foreign companies building cars and trucks here, it’s important to realize there’s many things that need to happen for it all to work, and not just a financial or taxation consideration.

Chad Kirchner
the authorChad Kirchner
In addition to Chad Kirchner's work here, he's a freelance automotive journalist for outlets around the world.

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