Starting next week, AvtoVAZ will transfer its 2 of 4 assembly lines to 3-day operation. The corresponding order was signed by president Nicolas Mohr on June 1.
In particular, the new schedule is introduced for assembly lines of Lada Kalina, Lada Priora and Lada 4×4. The working days for these conveyors will be Tuesday, Wednesday and Thursday. According to sources at the company, Mondays will be paid in the amount of 2/3 of the average wage.
Since February, AvtoVAZ has been working in 4-day week mode: Friday was a day off. Shorter working week was an alternative to mass layoffs due to declining demand for cars in the Russian market, and the corresponding drop in production (twice in the last three years). According to the company’s report for the first quarter, for the last 2 years the staff count fell by 23,000 people.
In addition, AvtoVAZ announced that from June 1 to June 15 the company is willing to pay 5 salaries for dismissal by agreement of the parties. According to two sources of RBC, 5,000 to 8,000 people may leave the company by the end of the year. Such a goal was set for the heads of departments.
In March, the resignation of the head of the company Bo Andersson was announced, who has been leading the company since 2014. According to RBC, Andersson’s contract contained some solid numbers, like achieve market share of 20%, and making the company profitable even at 6% operating margin. None of the conditions were satisfied. At the end of 2015 the enterprise set a record loss in the history: 74 billion rubles (approx. $1.1 billion – RRT). This is 3 times more than the year before. Loss from operations increased by more than 8 times: to 66.8 billion rubles (approx. $1 billion – RRT). By the results in 2015 the market share of AvtoVAZ amounted to 16.8%.
In late January, it was reported that AvtoVAZ will cut the salaries by 20%.