Avtovaz mass layoffs could bankrupt entire city
Published: 17 October, 2009, 12:08
Edited: 19 October, 2009, 19:23
Russia's largest carmaker Avtovaz continues to struggle through the crisis with multimillion dollar government donations unable to stop its plans of shedding thousands of jobs.
I am pleased that the report acknolwedges that the cars are 'outdated'. I am surprised to learn that Russia is still producing such outdated machines, especially if the Avtovaz company is part owned by Renault. In the UK we had a vehicle making company back in the 1970's that seemed to exist just to pay its workforce. The products were of poor quality, poor reliability, and were overpriced, especially when compared to the Japanese and European competition. The workforce were also not interested in quality, with stories of workers sleeping through the night shift, using hammers to get poorly made parts to fit, and even unpainted cars being left outside and then 'sprayed whilst wet from rain / condensation / frost. This company faced oblivion but restructured, parts of it sold off, old machinery replaced, staff retrained, and foreign partners found. Sometimes a company needs to be allowed to stare collapse 'down the barrel' so to speak in order to shake things up. I do not wish to see anyone loose their jobs, but sometimes the threat of unemployment is needed to motivate and focus a workforce. I am sure their are enough bright and forward thinking people associated with this company to help it restructure itself and shift production from the old ways, even if they end up producing a totally different product. At least jobs will be saved.
Welcome to the NEW WORLD ORDER, so coveted by Pres. Bush senior. People now unemployed by the millions all over the world. Yes, this high sounding NEW WORLD ORDER has caused a lot of misery worldwide {except for the rich}.
Avtovaz is just the tip of the iceberg many outdated non competitive industries throughout Russia will need to go through this painful experience if Russia is to emerge a competitor for trade on the global market. The workers of Altavaz should be thanking their management, government and the hard pressed Russian tax payer for giving them 10 extra years employment a more ruthless regime would have wielded the axe a long time ago. I have a lot of experience in production management and could not believe what I was seeing when shown footage of the plants operation it seemed to me they have 3 people doing 1 persons work I have never seen such a “laid back” workforce no wonder the company looses a fortune, As for the product well rubbish is the only word to describe it. This plant and others are a throw back to the soviet era when the “nanny state” took care of the citizens needs, a dinosaur waiting for extinction, my criticism is that this catastrophe was always going to happen and steps should have been taken to limit the damage to the community, The state will have to heavily subsidise this plant while at the same time encouraging new medium and small enterprises by offering tax breaks, hopefully as jobs are lost new ones will be created this process needs to take place across a range of industries or Russia may experience civil unrest. This will be the Russian government’s biggest challenge. Failure is not an option.










The main cause for current Avtovaz difficulties is because their cars are very bad. They car produced use to be very rusty, the engines are far from being durable, and the overall quality is very, very bad. The workers of Avtovaz, together with workers from their supplying companies, should think about that! It is around 100000 workers in Avtovaz and perhaps yet more, say 200000 of their suppliers, which amounts at around 300000. Now, do they believe that 150 million Russians ought to be hostages of these 300000? It is not about their cars are of an old design, but the main problem is quality: the Lada cars are simply assembled with too much of negligence. There is a widespread opinion that even a 1988 produced VW will last longer than a new Lada machine. The workers, engineers, and managers of Lada factories should bear that in mind.