Russia – AvtoVAZ lets go more employees image

The situation for the country’s largest carmaker, pharmacy look AvtoVAZ, cure seems to have turned from serious to critical, as the automaker has announced that at its Togliatti factory there would be not 7,500 job cuts – but around 13,000.

Just as the overall automotive sector is not doing very well in Russia – with sales continuing to decline after the dip recorded last year, the situation is mirrored at the automaker, which has recently been taken under the Renault Nissan alliance control.

“The total number of workers at the Togliatti plant in late 2014 will be about 53,000 people,” commented the automaker in response to inquiries from Reuters.

At the manufacturing site, which is the company’s main base of operations, at the end of 2013 there were 65,891 people employed, but as the new CEO Bo Andersson pointed out several times this year, the automaker’s situation is dire and people needed a “wake-up call.”

After AvtoVAZ dipped last year, turning a healthy business into one that lost money, Andersson was brought in to restore profitability – but he faces new threats from the economic problems combined with rising political tension over the Ukraine situation.

AvtoVAZ’s Lada brand saw sales in April dipping 15% to 128,633 units, a deeper loss than expected, as overall the Russian automotive market only went down for the month by 4%.

Via Automotive News Europe