MOSCOW, January 27 (RIA Novosti) – Russia’s largest carmaker AvtoVAZ has devised a plan to encourage employees to quit their jobs in an effort to restore the company to profitability, a Russian newspaper reported Monday.
Pyotr Zolotarev, head of the company’s labor union, told Vedomosti business daily that managers are offering employees five months’ wages if they voluntarily leave in February, four in March, and three in April.
AvtoVAZ’s first foreign director, Sweden’s Bo Andersson, who took office just two weeks ago, announced last week that the Lada manufacturer intended to slash 7,500 jobs representing 11 percent of its workforce as a cost-cutting measure.
Zolotarev said the company had not disclosed what would happen if fewer employees than the target chose to accept the offer.
The company has been facing sliding sales amid a stagnant Russian economy after recording strong growth in 2011 and 2012.
Andersson earned a reputation as a cost-cutter at another major Russian automaker, GAZ, where he served as director from 2009.
AvtoVAZ is the largest employer in the Volga city of Tolyatti, which was developed to house the factory’s workers and is considered Russia’s largest “monogorod” – a Soviet planned city dominated by a single enterprise.
The residents of such towns were the hardest hit during the economic crisis five years ago. Then-Prime Minister Vladimir Putin famously paid a visit to the town of Pikalyovo in the Leningrad Region in 2009 after demonstrators in the town blocked a major highway following layoffs and unpaid wages at the town's cement factory that left some of its residents unable to feed themselves.
