May 7 (Bloomberg) -- Ford Motor Co., struggling with Venezuela’s collapsing currency, has suspended production there for at least the remainder of the month due to parts shortages.
The second-largest U.S. automaker took a $310 million charge in the first quarter for the sharp devaluation of the Venezuelan bolivar. The company, based in Dearborn, Michigan, had already cut production in the South American nation because a shortage of hard currency made it difficult to purchase parts.
“Ford’s production operations have been suspended in Venezuela due to material shortages,” Kristina Adamski, a company spokeswoman, said in an e-mailed statement yesterday. “We have received a commitment from the Venezuela government to help resolve the issues and to get our production up and running by the start of next month.”
Ford lost $510 million before taxes in South America in the first quarter, more than double the $218 million it lost a year earlier. On April 25, the company said its losses in South America this year would exceeded the $34 million it lost there in 2013, a downward revision of its previous guidance. Ford said rising inflation and weakening currency is causing auto sales to plunge in Venezuela.
Ford’s shares were unchanged at $15.56 at 9:49 a.m. in New York. The stock had advanced 0.8 percent this year through yesterday’s close.
To contact the reporter on this story: Keith Naughton in Southfield, Michigan, at firstname.lastname@example.org
To contact the editors responsible for this story: Jamie Butters at email@example.com John Lear