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September 18, 2009

RUSSIA/GERMANY: Sberbank eyes budget Opel for AvtoVAZ

AvtoVAZ, 25% controlled by Renault, could produce parts for Opel and build a budget car for the brand as part of the Magna-led consortium running Opel, Sberbank chief executive German Gref said.

AvtoVAZ, 25% controlled by Renault, could produce parts for Opel and build a budget car for the brand as part of the Magna-led consortium running Opel, Sberbank chief executive German Gref said.

The deal will help bring new technology to Russia and could stabilise AvtoVAZ which is planning to lay off 5,000 workers despite an injection of state funds. AvtoVAZ has not previously been mentioned as seeking a role in the Opel deal.

“What we have been talking about in the [Opel] consortium is that we should create a special budget model for the Russian market. We can cooperate in car parts production,” said Gref.

The Kremlin said the Opel-Magna-Sberbank deal would bring new technology into Russia to help modernise its economy and cut its dependence on commodities sectors.

GAZ, part of indebted entrepreneur Oleg Deripaska’s Basel conglomerate, has already said it wants to be an industrial partner in the Magna/Sberbank deal on Opel.

Separately, GAZ has denied media reports that it plans 14,000 job cuts. Spokesperson Yelena Matveyeva was quoted by Friday’s Kommersant as saying the group plans to lay off a maximum of 5,800 people with about 4,000 of them either being redeployed or sent for retraining rather than losing their jobs.

GAZ Group had 118,000 employees when the crisis hit Russia in the second half of 2008. The number of the group’s employees fell to 80,000 people in early 2009 and then further decreased to 65,000–66,000 people by mid-2009, Kommersant added.

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