GM fined over spare parts prices by Venezuelan government image

Venezuela’s socialist government announced it was fining the local subsidiary of General Motors nearly $85,000 for allegedly selling spare parts at exorbitant prices.

The measure came as part of an aggressive drive by President Nicolas Maduro’s government to tackle Venezuela’s high inflation rate by forcing businesses to lower prices. Soldiers and state inspectors have been visiting hundreds of shops and companies, and have jailed dozens of people accused of price-gouging, in what Maduro calls an “economic war”.

Speaking from the GM subsidiary’s assembly plant in central Carabobo state, Industry Minister Ricardo Menendez accused it of selling spare parts at up to 500 % more than cost.

“Obviously this is a case of usury,” he said. “We are applying the highest fine possible … This has to stop. These speculative practices against the Venezuelan people have reached an end with the revolutionary government that is determined to defend the middle and lower classes.”

The company will have to pay 535,000 bolivars, the minister said. That is $84,920 at the official exchange rate of 6.3 bolivars per dollar. Like many products ranging from toilet paper to milk, car parts have become increasingly hard to find in Venezuela this year. Businessmen are predicting worse shortages for early 2014 due to a deterrent effect created by the recent crackdown.

Via Reuters