Michelin Looking to Expand Russian Operations
Russia is one of the markets that have been heavily hit by the economic recession, with several companies that are producing or selling cars in the country cutting workforce or lowering production to minimize costs as much as possible.
AvtoVAZ is surely the best example in this matter because some voices are hinting it could be close to bankruptcy. Furthermore, rumors are hinting that AvtoVAZ could fire more than 27,000 people out of the 100,000 employees currently working at the company's plants.
"The enterprise is working on one shift and at 65 percent of capacity. Lowering personnel numbers is essential in such a situation," AvtoVAZ said in a statement earlier this month.
The Russian government has already intervened in the case and called for support from Renault, the Russian carmaker that holds a 25 percent stake in AvtoVAZ.
"They confirm that they are ready in invest in AvtoVAZ's development and provide the most advanced technologies, which will be evaluated in the most transparent way," First Deputy Prime Minister Igor Shuvalov told reporters last week. "The most important thing is that Renault has confirmed strategic interest in the development of Avtovaz. Renault is ready to invest in Avotvaz," he added.
"Our main desire is to remain your partners. I think that all decisions taken by AvtoVAZ are very painful but necessary. You can rely on Renault. We feel socially responsible and that goes for AvtoVAZ's business plan too," he said after a meeting with Renault Senior Vice President Christian Esteve. "We will work out a new model line for AvtoVAZ. For that we need good parts suppliers."