Avtovaz Workers Protest Production Halts

Aug. 6, 2009
Workers want Russia's largest carmaker to be nationalized

About 600 workers at Avtovaz, Russia's largest carmaker and producer of the mythic Soviet-era Lada, protested on August 6 demanding that the mammoth firm be nationalized and jobs guaranteed.

"We need more workers' control over the factory and the workers' right to veto management decisions," Pyotr Zolotaryov, leader of the factory's independent trade union, said in a speech at the rally outside the factory.

Tensions have been steadily rising in Tolyatti, where Avtovaz employs over 110,000 people, as the factory on August 3 shut its doors in the third month-long production halt since the onset of the global economic crisis late last year.

Factory workers remain on two-thirds wages during the stoppages, but some of those who turned out at the demonstration carried placards with slogans such as "Real Help for Vaz!" and "A Voice for the Workers!"

"We are worried about the future of our city and of the factory," a 50-year-old protester who would provide only her first name, Rita, said. Another disgruntled Avtovaz employee in his mid-50s blamed the company's mounting woes on "bad management by the current leadership."

The plant is scheduled to re-start production in September, when workers will see their salaries reduced and their shifts cut to 20-hour weeks in measures Avtovaz management says are necessary to avoid mass layoffs.

Early in July, Avtovaz which is 25% by France's Renault, reported a net loss for last year of 24.7 billion rubles (US$ 799 million) after a profit of 3.7 billion rubles in 2007. The figures reflected dire trends in the Russian auto sector, which until last year had excited investors as the fastest growing car market in Europe.

The Russian government has shown readiness to step in and force factories to keep running, worried their closure could spark social unrest in towns where single, Soviet-era industries accounts for the bulk of the local economy. In late March, Moscow pledged 25 billion rubles in aid to Avtovaz.

Copyright Agence France-Presse, 2009

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!