Toyota’s management may have thought that it is better to just import the specific Toyota model in question than to manufacture them in Venezuela. The company says it applied for a permit to import the Land Cruiser model but the government has not acted on the application.
Because of the poor condition of the roads in the rural areas of Venezuela, the 4×4 model which they refer to as ‘rustic’ vehicles including the Land Cruise 70 served the slum, hilly and remote areas with poor road conditions quite well. This could be the primary reason why Chavez wanted to continue its production in Venezuela, though he seems to point to the transfer of technology as the main reason.
the malaysian insider.com reports:
Chavez ordered his Trade Minister Eduardo Saman to carry out a “severe inspection” of Toyota, and warned other companies they must start sharing technology with Venezuelans.
“You tell the people at Toyota that they have to produce this model and we are going to impose a quota, and if they don’t meet it, we will punish them,” he told Saman, adding that the state would not hesitate to expropriate Toyota’s facilities and pay appropriate compensation.
In his remarks at the ceremony to hand over keys to the economically produced cars from Argentina, Chavez said:
“We must force them. And if they don’t, then they should leave and we’ll bring another company in … The Chinese want to come and they make ‘rustic’ models.”
“Companies who come here to set up must be ready to transfer technology to us,” Chavez said.
“If they don’t want to, they should go away. I invite them to pick up their things and go,” he added, saying companies from allies like China, Russia, Belorussia and Iran were ready to take their place.
Toyota management in Venezuela claimed that the government has been informed of the decision to import the desired units rather than manufacture them in Venezuela.
Toyota’s action could have been a purely business decision as the management may have found out that it would be cheaper to import than to manufacture them in Venezuela.