Yesterday, General Motors informed media its manufacturing facility and industrial hub in Venezuela had been illegally seized by the country’s authorities. With the announcement, GM vowed to take all legal action, condemning Venezuelan authorities in the process.
“GM (Venezuela) strongly rejects the arbitrary measures taken by the authorities and will vigorously take all legal actions, within and outside of Venezuela, to defend its rights,” the automaker said in a statement.
As for the legal actions in can pursue, there aren’t many. The Detroit Free Press reports GM’s legal response will likely be limited, and may only have an effect should Venezuela have some assets in the United States.
“They can go to the courts here in the United States and try to seek action, but that really is not going to be effective unless the Venezuelan government has some assets here” that could be seized as compensation, Peter Quinter, Miami-based chair of the law firm Gray Robinson’s Customs and International Trade Law Group, said. “I don’t see that happening.”
If there’s a silver lining to the situation at all, it’s the fact these happenings likely won’t impact GM’s financial performance. The automaker, along with most other companies, has struggled in recent years amid a hostile political and social climate in the country. GM forecasted minimal vehicle sales and production for 2017.
GM hasn’t built a vehicle at the Valencia-based plant in the country since 2015. Previously, the Aveo, Spark and Cruze were all assembled in the country.