Pirelli says it has ‘disposed’ of its car tyre factory in Guacara, Venezuela and has ceased all activities in the country after 28 years.
The news of the Italian supplier’s move to quit Venezuela comes as the country descends into a spiral of hyper-inflation and as an exodus of huge swathes of its population attempts to escape rapidly worsening domestic economic conditions.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Television pictures show large numbers of Venezuelans trying to flee to neighbouring Colombia, while reports have speculated inflation could reach a staggering million per cent by year end.
“Pirelli announces the disposal of its car tyre factory in Venezuela, located in the city of Guacara and all the activities held in the country,” said a statement from the Italian supplier.
“The operation follows the de-consolidation of the Venezuelan subsidiary which took place on December 31, 2015 and has no financial effects on the group.
“The agreement, which calls for employment continuity, was reached with a consortium of South American entrepreneurs and the company Sommers International, in the capacity of buyer.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData“Pirelli wishes to thank its collaborators and clients for its 28 years of activity in the country and wishes the new management every success.”
Venezuela has vast oil reserves, but its currency is swiftly devaluing, triggering a vast flight of its population.
