General Motors reportedly got a Kremlin-backed partner to help boost its Russian joint venture on Thursday when officials from the state arms export agency took over management of AvtoVAZ, the maker of Lada cars.

Reuters said analysts have been welcoming toward a greater state presence at ailing AvtoVAZ in the face of foreign competition.

Shareholders at the company, which is partnered with GM in the GM-AvtoVaz venture, elected a new board dominated by state officials on Thursday, the report said.

The board promptly named Igor Yesipovsky, head of the trade and technical division of Rosoboronexport, Russia's national arms exporter, as AvtoVAZ's new general director, according to Reuters.

He reportedly told a news conference that GM-AvtoVAZ, which earlier this year cut its 2005 production target to 55,000 from 75,000 cars, was not doing well.

"We can't be satisfied with the economic situation which this project is in. The factory is working with zero or even slightly negative profitability. This issue will be the subject of discussion at future board meetings," Yesipovsky said, according to the news agency.

Reuters said AvtoVaz itself, Russia's flagship carmaker, has been increasingly losing out to foreign competition and has been seeking more cash.

Board member Boris Alyoshin, who also heads the Federal Industrial Agency, reportedly said Avtovaz wanted government help.

"The total amount of state support has not been specified, but the request is for around US$5 billion up to 2010," he said, according to Reuters, which noted that increased state interest in AvtoVAZ follows the recent resignation of its long-serving chief Vladimir Kadannikov.

Analysts, however, reportedly have voiced concern about the growing power of Rosoboronexport, which they see as a closed and highly bureaucratic organisation with no industry experience.

Reuters said the changes come amid market talk that state-owned banks were buying up the firm's stock to increase state control.

"This is not about nationalisation, this is about state support," Vladimir Artyakov, a Rosoboronexport deputy director newly appointed as AvtoVAZ chairman, told the news conference, according to the report.