Struggling East European automaker IzhAvto has plans to axe 2,407 jobs, a local press report has said.

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The company, which is based in Udmurtia, plans the lay offs for the period from 24 August to 24 September.


Russian reports said that IzhAvto had already informed the regional employment service of the cuts.


IzhAvto’s financial crisis has been deepening recently.


In April it was reported that the company defaulted on a buyback of 1.238 billion roubles worth of bonds because of a lack of funds.

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The report added that IzhAvto is verging on bankruptcy and may halt production.


Russia’s SOK Group, which owned 98% in IzhAvto, recently sold a 74.8% stake in IzhAvto to senior managers of the carmaker.


Exchange rate problems have compounded difficulties for IzhAvto arising from a collapse in the Russian car market since late last year.