GAZ Fires 5,800, Prepares Opel Production

Russian automaker GAZ Group, one of the companies involved in the over-debated Opel selling process, announced its decision to cut its workforce by 5,800 employees in a move supposed to help the company cope with the economic recession. This isn't the first time when GAZ turn to job layoffs to deal with the crisis as it initially fired 1,200 people in charge of the Volga sedan production, Reuters reported. Nevertheless, the Russian carmaker is still struggling to recover from a 60 percent drop in sales this year.

"Before now we had been able to avoid mass layoffs," a company spokeswoman was quoted as saying on Wednesday by the aforementioned source.

On a separate front, GAZ is getting ready to start production of Opel models, in case Magna succeeds in taking over the German unit. GAZ Group is an industrial partner for Sberbank and Magna International, the two partners who are now favorite in buying a stake of 55 percent in Opel.

"As of today, GAZ Group is the best prepared in terms of technology to take on their (Opel's) production," the spokeswoman said. "We have specialists that have been certified by them, by Opel."

But Magna is still unsure whether it will be able to complete the acquisition of Opel as the German officials repeatedly said they are still negotiations with some other bidders. GM Europe boss also confirmed the news, hinting that Opel could even so step under the patronage of Chinese – BAIC – or Belgium – RHJ – companies.

“We’re in very active negotiations with several potential partners including Magna, Beijing Auto and Ripplewood,” Chris Preuss, a GM Europe spokesman, was quoted as saying by Bloomberg. “I wouldn’t comment at this point on the status of the talks or the specific details of the negotiations other than to say we have very strong interest in Opel from all the parties involved.”