Avtovaz, Russia’s largest but struggling carmaker, said on Thursday it planned to fire 7,500 workers, or 11 percent of its workforce, as it tries to cut costs and return to profit.
The carmaker, which is set to be controlled by the French-Japanese carmaker Renault-Nissan by mid-2014, now employs 66,500 people.
“The standard headcount of managers, specialises and clerks will be cut by 2,500 jobs,” the automaker, most famous for its clunky Soviet-era Lada cars, said in a statement.
“Also a reduction by 5,000 jobs is anticipated by the end of the year within framework of productivity improvements.”
The Russian government has over the past years spent billions of dollars trying to prop up its struggling carmakers, including Avtovaz, which is based in the Volga River city of Tolyatti.
Weary of possible social consequences, the government has long resisted drastic measures such as laying off personnel at car plants en masse.
Sales of cars and commercial vehicles in Russia fell last year by 5.5 percent to 2.78 million units amid weak economic growth, according to the Association of European Business lobby group.