Head of Russian Car Giant Avtovaz Quits

Reports are that Russia was planning to create a new holding firm to bundle together state-owned stakes in three of its top auto firms, including Avtovaz.

With a structural shake-up at the crisis-hit manufacturer of the Lada car in the offing, the head of Russian auto giant Avtovaz has quit, the company said on August 25.

Boris Alyoshin has decided "to quit his post as head of the company in connection with moving to another post," Avtovaz said in a brief statement posted on its website. It added that the issue would be discussed at a meeting of the company's board of directors in "the nearest future."

No further details were given but the announcement came after media reports that Russia was planning to create a new holding firm to bundle together state-owned stakes in three of its top auto firms, including Avtovaz.

The stakes owned by the state-owned Russian Technologies in Avtovaz, truck maker Kamaz and engine-manufacturer Avtodizel will be consolidated into a holding named Avtoinvestholding, news agency reports said.

Russian Technologies, a sprawling conglomerate with holdings in a variety of sectors, owns 37.8% of Kamaz, 25% of Avotvaz and 30% of Avtodizel.

The Russian car industry, a favorite of investors in recent years, has been hit by an unprecedented crisis due to a slump in demand in what was once Europe's fastest growing auto market. Both Avtovaz and Kamaz suspended production in August in response to falling sales, while unconfirmed reports have suggested that Avtovaz is preparing massive job cuts.

Copyright Agence France-Presse, 2009

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