A working group will submit a set of measures to aid struggling carmaker AvtoVAZ to the Russian government in December, Vnesheconombank, or VEB, has said.
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The working group includes industry and trade minister Viktor Khristenko, economic development minister Elvira Nabiullina and representatives of state-run banks.
Among a number of rescue measures, the group is discussing a purchase of AvtoVAZ bonds by VEB.
AvtoVAZ, Russia’s largest carmaker, is on the verge of bankruptcy, according to Kommersant business daily, which said earlier this week that the company needs to cut almost 50,000 jobs if it is to have any hope of survival.
The newspaper cited a government memo written by deputy industry minister Andrei Dementiev for the government, which cast doubt on cooperation with Avtovaz’s 25% shareholder Renault.
According to Kommersant, Dementiev said the carmaker would have RUB76.3 bn (US$2.6 bn) of debt at the start of next year, excluding RUB9.8 bn (US$300m) owed to suppliers.
AvtoVAZ has already said it plans to slash 27,600 jobs from its workforce of 102,000 in a bid to cope with the slumping demand caused by the economic crisis.
