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Monday, 12 March 2012






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Consumers line up to buy Chinese-Venezuelan cars

Venezuela: Just weeks after the opening of four Chery dealerships in Venezuela, dozens of people are lining up every day to buy the first Chinese cars being sold in the Latin American nation. Unlike competing Japanese and American cars, import preferences granted by the Venezuelan government mean the Chinese cars are cheaper, which has attracted a steady stream of interested customers.

"I came to buy here because elsewhere there are no cars and this is an alternative," stylist Juan Hernandez, 33, told AFP while waiting in front of the dealership.

The entrance sign is still covered in black plastic, but already draws attention from passersby on a busy road in Caracas.

The cars are assembled in Venezuela under an agreement with the Chinese, who President Hugo Chavez considers a major ally. The manufacturing enterprise is financed jointly by Chery and a Venezuelan public-private company. Three other Chery dealerships are operating in other parts of Venezuela. The manufacturer plans eventually to expand to 18 Venezuelan dealerships. Chavez named the car models the Arauca and Orinoco after two rivers that run through Venezuela.

Until sales of the Chery began, Venezuela suffered a shortage of cars because of import and exchange controls on other foreign vehicles.

Japanese and American brands like Toyota and Chevrolet operate plants in Venezuela, but they do not benefit from "exchange preferences" like the Chinese companies, according to economist Jose Guerra.

"Cadivi (the government agency that oversees foreign exchange) provides discretionary dollars and encourages Chinese enterprises" because of the close relations between the Venezuelan and Chinese governments, he said.

For customers like Hernandez, the previous scarcity of automobiles meant delays in being able to buy a new car, which led him to lose his bank credit line for the purchase.

Now he wants to buy an Orinoco for about $30,000, which he says is "a little cheaper" than other similar models in the expensive Venezuelan market.

Yury Soto, a 37-year-old civil servant, plans to buy an Arauca, which is a smaller and simpler model that sells for about $20,000.

"We came to buy here because it is cheaper and it is what we can afford, thanks to prices that the president arranged," Soto told AFP.

"Two weeks ago I came at six o'clock in the morning, I waited in line and they gave me a credit form," Soto said.



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