Temporary measure or close of play? Pirelli stops production in Venezuela

The Pirelli factory in Guacara, Venezuela hasn’t escaped the economic turmoil the country is currently experiencing, and plant workers received a nasty surprise upon arriving for yesterday’s shift. Local news sources report that the factory has been shuttered as it lacks the raw materials needed to maintain production. Pirelli is also allegedly unable to pay the wages of its 704 unionised workers and approximately 175 other employees in Guacara following the introduction of currency reforms on 20 August.

Workers are angered by Pirelli’s alleged failure to give prior warning of the plant’s closure, and they say they still don’t know if the closure is temporary or permanent. At this stage neither Pirelli nor parent company ChemChina have commented on the decision to stop production in Venezuela.

Pirelli temporarily halted production within the Guacara plant due to raw material shortages on several occasions last year. According to Luis Alvarez, general secretary of the union representing plant workers, the Pirelli de Venezuela factory in Guacara has operated at less than 50 per cent capacity since 2015 and at as little as seven per cent capacity this year. Average capacity utilisation between January and June 2018 lay at 7.5 per cent, with only 45,000 tyres produced in this period.