AvtoVAZ Workers Rallied Against Potential Job Cuts

After we reported in late July that Russia's biggest auto maker, AvtoVAZ was closing its production gates for a month, we now return with updated news regarding this subject.

More than 2,000 workers gathered on Thursday in Togliatti, Russia to demonstrate against more pay and production cuts. The protesters gathered near the city's prosecutor's office and waved banners that requested the Russian government to take over the automaker and begin an investigation concerning alleged misuse of funds by the company's management, Edmund's Inside Line reported.

The demonstration on Thursday was lead by the automaker's independent labor union called Yedinstvo. The 160,000 workers Russian car maker had in 2006 were reduced to 105,000 due to plunging demand.

AvtoVAZ is owned in a joint venture by the state corporation Russian Technologies, Troika Dialog Investment, French car manufacturer Renault, all retaining a 25 percent stake and numerous small stakeholders that control the remaining 25 percent.

Though the Russian Prime Minister, Vladimir Putin, promised during a visit in March that no job would be lost and that the company would receive if needed a government bailout, AvtoVAZ still continued to register negative results.

The simple fact of the matter is that AvtoVAZ's biggest brand, theLada, can't compete with the foreign car makers' products. The Russian automaker has the work force but can't seem to put it to work accordingly, a bitter truth that is emblematic for most of the Eastern European automotive industries.

Until now AvtoVAZ officials have denied any job cuts.
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