Russia's GM-Avtovaz, a joint venture between General Motors Corp. and Avtovaz, has downgraded its production forecast for 2003 and plans to halt production due to large stockpiles, Dow Jones reported, citing a local automotive news agency.

According to the report, GM-Avtovaz chief executive John Mylonas told a conference in Togliatti, where its production is based, that the company plans to produce 25,300 sports-utility Chevy-Niva vehicles in 2003.

Dow Jones noted that, at the beginning of 2003, GM-Avtovaz planned to produce as many as 35,000 SUVs and in October downgraded that forecast to 27,000. GM- Avtovaz has about 4,000 cars stockpiled, the report added.

Analysts told Dow Jones that one of the reasons for the stockpiles could have been a sharp rise in prices in October to €8,500 from $US8,000. The report added that GM-Avtovaz plans to switch to ruble pricing in January, but lock in December's high euro-ruble exchange rate.

The company will halt production for three weeks from December 22 to January 12 and is likely to work in two shifts in January and February, compared with the current three shifts, Mylonas reportedly said.

The company plans to improve sales, by increasing the number of national sales subsidiaries and offering better loan terms, Dow Jones added.