Goodyear Tire & Rubber Co. is halting production in Venezuela, making it the latest international corporation to abandon a South American nation in economic crisis, officials said Monday.
Spokesman Eduardo Arguelles told The Associated Press that Goodyear-Venezuela had made the "difficult decision" to no longer produce tires in the country, which has seen an economic contraction worse than the U.S. Great Depression.
"Our goal had been to maintain its operations, but economic conditions and U.S. sanctions have made this impossible," Arguelles said.
The company had endured tens of millions in losses in recent years as the Venezuelan bolivar plummeted in value against the U.S. dollar. The company based in Akron, Ohio, moved to deconsolidate its Venezuelan subsidiary in the fourth quarter of 2015, but continued to operate with a staff of about 1,100 from the depressed industrial city of Valencia.
Workers who arrived at the plant Monday were stunned to find it was no longer in operation.
"They closed doors without saying anything," said Luis Aponte, a union worker who said government workers were on site assessing the situation.
There was no immediate response from the government.
The announcement came after a letter issued "to whom it may concern" circulated online stating the company had been forced to cease operations and that starting Monday no one in Venezuela would be authorized to continue producing the company's products.
The letter also said Goodyear would fulfill its financial obligations to workers.
Goodyear's retreat from Venezuela adds it to a growing list of corporations that have ceased operations in the country. Some of those enterprises, like General Motors, had assets including factories and vehicles seized by the government. Others chose to cut their losses because shortages, inflation and currency and prices controls made business difficult.
Kellogg, Bridgestone, Kimberly-Clark and General Mills have all closed or reduced operations in recent years.
Julian Rodriguez, 62, said he spent over three decades working for Goodyear and was unsure how he'd make ends meet after losing his only source of income.
"This is a grave situation," he said.
The International Monetary Fund has estimated that inflation in Venezuela could top 1 million percent by the year's end.
President Nicolas Maduro activated an economic recovery plan in August that including increasing the minimum wage and printing a new currency, among other measures, but thus far the economy has shown few signs of improvement.