Thursday, September 24, 2009

The Russian "AvtoVAZ" 27,600 cancellation

Samara - Russian giant car manufacturer "AvtoVAZ" announced today that it will cancel up to 27,600 jobs, less than previously counted, in an attempt to mitigate the consequences of falling sales due to the global economic slowdown.

The company is the official website announced that it would include reducing the number of employees and 5,000 managers, engineers and administrativaca, as announced last week, passed the agency.

"AvtoVAZ", whose 25 percent share is owned by the French "Reno", earlier announced that it considers the abolition of the 36,000 jobs.

Press service "AvtoVAZ" announced on Wednesday that the company's president Igor Komarov trade union representatives and employees discuss the measures in the anti-crisis program, in which the total number of "Avtovazovih" workers will be around 75,000.

Then it is announced that the largest Russian car manufacturer dismissed workers to 1 December this year.

A source from the Russian Ministry of Social Development said that insisted that the dismissal be gradual in order to reduce social tensions, told the Itar-Tass.

"AvtoVAZ", according to the media, has about 110 thousand employees. The producer of "lade" in the first half of this year, sales of passenger cars decreased by 44 percent to 179.9 thousand pieces.

Pure loss of the company in that period amounted to 14.2 billion rubles (315 million euros), while in the same period of past net profit was 1.49 billion rubles. Profit of the company was reduced more than twice the entire 40.22 billion rubles (893 million euros). Earnings from the sale of cars has been reduced by 50.2 percent, and sales of spare parts by 15.9 percent.

Research Agency Avtostat "shows that by the end of this year 30 dealers of Russian car manufacturers" AvtoVAZ "could go bankrupt due to falling sales, while 14 dealers throughout Russia, but is in great financial problems.

Currently "AvtoVAZ" has 445 official distributors, and if the forecasts on the closing exercise, the share of Russian auto giant in the domestic market could fall by around eight percent.

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