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February 11, 2008 |
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GENERAL MOTORS: Some Colombian Production Going to Venezuela General Motors Corp. said in a statement that it will transfer part of its Colombian output to Venezuela due to the restriction the Venezuelan government placed on imports. Dow Jones Newswires relates that the Venezuelan government decreased quotas for car imports from everywhere else to increase output from domestic car assembly lines. According to General Motor's statement, the company secured authorization to sell 8,500 cars from Colombia in Venezuela this year, as part of the new quotas. General Motors spokesperson Eugenio Hoyos told Dow Jones that the firm's local unit would transfer some 14,600 cars from Colombia to Venezuela this year, compared to 11,066 cars last year. The Associated Press notes that Venezuelan car sales increased 43.3% in 2007, compared to 2006, due to a drastic boost in the purchase of imports. Imported cars sales rose 81% in 2007, from 2006. Meanwhile, sales of domestically manufactured cars dropped 1.3%. Mr. Hoyas told Dow Jones that General Motors will increase its output in Venezuela. Dow Jones says that before the change in quotas, General Motors' Colombian unit wanted to assemble some 70,000 cars this year, compared to 52,000 cars last year. General Motors will cut its new hiring from the 470 it had planned for this year, Dow Jones states. It will invest about US$51 million in Colombia. Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/ -- was founded in 1908. GM employs about 280,000 people around the world and manufactures cars and trucks in 33 countries, including the United Kingdom, Germany, France, Russia, Brazil and India. In 2006, nearly 9.1 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 9, 2007, Moody's Investors Service affirmed its rating for General Motors Corporation (B3 Corporate Family Rating, Ba3 senior secured, Caa1 senior unsecured and SGL-1 Speculative Grade Liquidity rating) but changed the outlook to Stable from Positive. In an environment of weakening prospects for US auto sales GM has announced that it will take a non-cash charge of US$39 billion for the third quarter of 2007 related to establishing a valuation allowance against its deferred tax assets (DTAs) in the US, Canada and Germany. As reported in the Troubled Company Reporter on Oct. 23, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and other ratings on General Motors Corp. and removed them from CreditWatch with positive implications, where they were placed Sept. 26, 2007, following agreement on the new labor contract. S&P said the outlook is stable. |
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