The US automaker said it’s forecasting for the second quarter big losses in its South American operations, with the key factors being Venezuela’s foreign exchange rate changes and the region’s slowing sales.
According to the company’s executive vice-president, Joe Hinrichs, Ford is also preparing for a full year of losses in the South American region, slated to overshadow the already bad result for 2013.
The No.2 US carmaker reported that after in the first quarter of 2013 it lost in the region $218 million, for the same period of 2014 the losses amounted to $510 million – because of the currency devaluation in Venezuela and Argentina.
After in 2013 its plant in Venezuela already operated at a very low capacity, the operations in the country were further disrupted this year after Ford had to stop car production altogether because of a lack of foreign currency needed to pay the imports of auto parts from suppliers.
Recently, after the local black market made dollars inaccessible, the Venezuelan government decided in March to establish a new currency platform designed to buoy and ease the access to dollars for local companies.