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UPDATE: AvtoVAZ Seeks Aid As Losses Triple
Russia’s largest carmaker, OAO AvtoVAZ, says its net loss tripled to 74 billion rubles ($932 million) in 2015.
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Russia’s largest carmaker, OAO AvtoVAZ, says its net loss tripled to 74 billion rubles ($932 million) in 2015. Demand for its Lada cars plummeted 36%, and revenue sagged 8% to 176 billion rubles ($2.2 billion).
Bloomberg News reports the company at year-end had breached covenants on loans worth more than 43 billion rubles ($542 million). A Moscow-based analyst tells the news service the company faces collapse without shareholder support.
AvtoVAZ’s two largest stakeholders are Renault SA with a 50% share and the French carmakers alliance partner, Nissan Motor Co. The three companies account for about one-third of the Russian car and light commercial vehicle market.
CEO Carlos Ghosn says Renault will “do whatever it takes” to sustain AvtoVAZ until the Russian market revives. The country’s demand for light vehicles contracted 37% to 1.60 million units over the past three years, according to the Moscow-based Assn. of European Businesses.
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