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Effect of the sanctions: Traditional brand Lada wants to cut 3000 jobs

2022-08-03T15:17:47.193Z

The Russian car industry is in crisis: the manufacturer of Lada now wants to significantly downsize one of its locations. However, the group wants to avoid mass layoffs.



Lada symbol on a radiator grille

PHOTO: ALEXANDER DEMIANCHUK/ REUTERS

Against the background of far-reaching Western sanctions, the Russian car manufacturer Avtovaz wants to downsize one of its locations.

This is reported by several Russian news agencies, citing the company.

Avtovaz sells its cars under the Lada brand name.

In the city of Ischewsk, around 1000 kilometers east of Moscow, employees who left the company voluntarily were offered a severance payment of twelve minimum wages or five average wages.

That should be a maximum of 183,348 rubles, the equivalent of a good 3,000 dollars.

Avtovaz: Voluntary offer to leave

Alternatively, the employees in Ischewsk are offered a job with another employer in the region.

At the same time, Avtovaz emphasized that he was not aiming for mass layoffs, and that the program was voluntary for all employees.

The auto industry in the giant country has been hit hard by the sanctions imposed by Western states in response to Russia's war of aggression against Ukraine.

In particular, Russian manufacturers lack parts and technology from abroad.

The Izhevsk plant has therefore been idle for months.

Electronics seem to be the hardest part to replace.

According to other reports, new Russian cars, if they can be completed, are currently often delivered without computer components, so that anti-lock braking systems, for example, are missing.

Until recently, Avtovaz belonged to the group of the French car group Renault, but has now been nationalized again by Russia.

At the end of July, employees from Izhevsk wrote an open letter to Kremlin chief Vladimir Putin asking for their location to be preserved and their jobs to be protected.

According to Russian media reports, the production of the Lada Vesta model is now to be relocated to the main plant in the city of Tolyatti.

Car production plants in Russia are often located in smaller cities and are the most important employers there, so mass layoffs should be avoided.

Izhevsk has 645,000 inhabitants.

mamk/dpa/Reuters

Source: spiegel

All business articles on 2022-08-03

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