Fuel Systems Solutions, Inc. (FSYS)

[Democritus_of_Abdera]

Venezuela was an important market for FSYS in the recent past. But not this year.

In the 2014Q1 CC Pietro Bersani (FSYS CFO) said that there were no BRC units sold in Venezuela.

I suspect that the 2014Q2 results will also reflect an absence of input from Venezuela.... This suspicion is based upon a report last week in the Wall Street Journal that detailed the miserable state of affairs for the Venezuelan auto industry....

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The 2014Q1 statement by Pietro Bersani in Q&A on May 8, 2014:

Matthew Blair – Macquarie Capital (USA), Inc
Great. Thank you. And then just want to follow-up on Venezuela. From the prepared remarks, it sounds like you’re still down there. I know Ford was down for a couple of weeks, but I thought they’d start back up. How much longer do you think you will be down? How much of an impact is this going to be in the second quarter? And is it fair to say that Venezuela is your most important Latin American market? Thanks.

Pietro Bersani – Fuel Systems Solutions, Inc.
Well, I will say the most important market in Latin America is Argentina more than Venezuela. You are right about the fact that right now, which is down in terms of sales OEM. As a matter of fact, we had no units sold in Q1 2014. It’s difficult every time it comes to a tradition, which is impacted by local political situation. However, I will not exclude that over the next few months that the situation could be positively evolved so that we can start again with those sales. This is overall what I can tell you, but really, Matthew, it is a matter of how difficult it can be a tradition, which is primarily political driven.

Quotes from Wall Street Journal (Ezequiel Minaya July 21, 2014) http://online.wsj.com/articles/in-venezuela-old-cars-become-investment-vehicles-1405972426

Car makers, including global giants like Ford Motor Co..., Fiat Chrysler Automobiles...., General Motors Co. .... and Toyota Motor Corp. ..., have cut output by more than 80% in the first six months of the year compared with a year earlier because of a lack of dollars to pay parts suppliers, according to data compiled by the Automotive Chamber of Venezuela, which represents car makers.
...
Across Venezuela, car production and sales has been sliding fast. Balance sheets have been battered, with revenue vulnerable to devaluation and trapped in Venezuela because of currency controls. Auto makers built 36,919 vehicles through June of last year. But only produced 6,161 during in the same period this year, about what Argentina produces in a few days.
....
Mr. Maduro, though, blames the car companies, not the country's economic policies for hobbling the auto sector. The government fined GM last year after accusing it selling overpriced car parts. In February, the president publicly criticized Toyota for its plans to cease production, suggesting the Japanese car maker was colluding with his political foes to destabilize his government.
...
One auto executive, who works for a non-U.S. company and spoke on the condition of anonymity, said the Maduro administration had failed to deliver dollars promised last year through the central bank's SICAD system, which sells a limited amount of greenbacks at a weakened exchange rate. That executive estimated the government has delayed up to $4 billion in payments the car companies need to convert local currency into dollars to pay international suppliers for parts. "Some companies have shut down their lines because of the lack of materials, others are working at a reduced rate," said the auto executive. "Eventually, raw materials will finish for us all and there will be zero new cars."
....
Buyers seeking new cars can spend years on waiting lists. New car sales totaled 98,878 in 2013, a fall of 80 % since 2007, when car sales peaked at 491,899. Restrictions on car imports, coupled with the fall in car production, have made Venezuela the rare country where used vehicles climb in value.