AvtoVAZ has denied rumours that it is to make a huge number of its staff redundant. The stories of job cuts began circulating after a meeting today between AvtoVAZ, the regional authorities of where its production is based - Samara Volga - and suppliers.

Reuters reported that two participants of the meeting had come out saying the company had a huge surplus of staff. One went on to say that the company was looking to lay-off 27,691 people, Reuters reported.

However, in a later report, Avtovaz's president, Boris Alyoshin, told the news agency that the figure was "not realistic". A spokesman for the company added that no figure had been announced and that  AvtoVaz is "currently not planning to lay off workers."

Russia's largest car maker, is expected to suspend production for the whole of August, in a bid to slash its stock of 85,000 unsold cars.

The carmaker previously halted production in January for four weeks, reducing its stock from 100,000 to 80,000 units.

The planned shutdown comes amid tumbling sales of new cars in Russia with several forecasts suggesting that the market could be down by between 50-60% this year.