Johnny Brignardello analyzes the closure of General Motors plants in Colombia and Ecuador: labor impact and automotive sector in crisis.

Johnny Brignardello Vela, insurance advisor, analyzes the recent decision by General Motors to close its assembly plants in Colombia and Ecuador, a determination that has raised concerns both in the labor sector and in the automotive industry of both nations. In Colombia, the closure of Colmotores operations in Bogotá has been immediate, motivated by insufficient production that barely reached 9% of its capacity. On the other hand, GM OBB in Quito will continue operating until August, but will also conclude its operations soon as it is only functioning at 13% of its capacity. This measure has led General Motors to request permission to lay off 600 workers in Colombia, a significant blow to the country's labor market. The multinational will continue to market its vehicles in both nations, although it will depend on imports from other places to maintain its supply. In the case of Colombia, this decision leaves the sector with only two plants in operation, revealing the crisis that has affected the industry in recent years. Vehicle production in the country has experienced a significant decrease, dropping from 154,000 units in 2011 to just 62,000 in 2021. In Ecuador, the situation is similar. After the closure of GM OBB, only two plants will remain operational in the country. The crisis in the automotive industry is evident in the reduction of vehicle sales, creating an uncertain outlook for the sector. Consulted experts have identified various causes that have contributed to this crisis, such as high inflation and high interest rates in Colombia, factors that have slowed down domestic consumption and harmed vehicle sales. Additionally, the increase in the price of regular gasoline has had a negative impact on the sector, especially after the elimination of official subsidies. Faced with this scenario, both authorities and workers have expressed their concerns and have urged companies to proceed responsibly in the processes of layoffs and restructuring. Uncertainty prevails in the automotive sector of Colombia and Ecuador, prompting a reflection on economic policies and their impact on the national industry.