“Lada” .. The icon of Russian cars is struggling for survival

MOSCOW

- The harsh Western sanctions against Russia have caused severe crises on many industrial sectors in the country, and its list - the longest in the history of international relations - directly affected the car manufacturing sector, led by AvtoVAZ, the icon of Russian car factories, the most ancient and famous on the planet. world-wide with its "Lada" brand.

As a result of the sanctions, only 4 plants remain operating in Russia, namely Gas (GAZ) and UAZ in Ulyanovsk, and Mazda Sollers in Vladivostok (small, producing very little of the cars) and the Chinese "Haval" in the Tula region.

As for the rest of the foreign companies, they either left the Russian market entirely, or stopped shipping cars in order to determine their new value in light of the growth of dollar and euro prices against the local operation.

This crisis has touched more severely the large car factories in Russia, led by "Autovaz". During the past few weeks, the company has reached a state of complete halt in the manufacture and assembly of cars due to the shortage of electronic components, and the disruption of supply chains.

Quite simply, they have nothing left to make, especially with Bosch, the main supplier of microelectronics, out of business in Russia.

call for help

Faced with the great challenge, the auto giant began searching for suppliers of spare parts and components from Asian countries, and starting from the first of last March, the company raised prices by 10-20%, and also sent an urgent appeal to the government to intervene and request support.

Furthermore, deficit expectations have forced AutoVAZ's management to plan the transition to the part-time work week, and to push the fifth day of the work week out of the federal budget.

The crisis was further exacerbated by Renault's announcement of the suspension of the capital's plant, and it is known that the Renault-Nissan alliance owns 68% of its shares.

However, experts say that even in the most pessimistic scenario, the state will not leave the car factory in Tolyatti without support, especially with the threat of Renault stopping its activities in Russia, which announced that it had taken all necessary measures to comply with international sanctions, and began to gradually sell its stake. on the Russian market.

AutoVAZ is the icon of the most ancient and well-established Russian car factories and is famous in the world with its brand "Lada" (Anatolia).

struggle for survival

In any case, AutoVAZ may need long months to return to the production of models that are less dependent on foreign spare parts and electronic components, which of course requires the adoption of new suppliers, and in this way, the company is on the cusp of entering the most complex stage of its history to survive. , restoring bygone glory.

In the sixties of the last century, the automobile sector in the Soviet Union suffered from a huge shortage, and at that time, the distribution of Pobeda, Volga, Moskvitch and Zaporozhye cars was distributed exclusively according to the lists of companies, and in Most of the time it was purchased only in the workplace, and through a lottery or raffle.

On July 20, 1966, after analyzing 54 different construction sites, the Central Committee of the Communist Party and the Soviet government decided to build a new large automobile plant in Tolyatti.

Ironically, the Soviet auto giant was founded in the city named after the leader of the Italian Communist Party, Palmiro Togliatti, after his death in Crimea in 1964.

In Russia, it is said that even stray cats heard about the city of Tolyatti, the birthplace of the Lada, and until the mid-sixties, the inhabitants of Tolyati were actually residents of Stavropol on the Volga, before the name of the river was added to the name of the city so as not to be confused with the existing Stavropol In the North Caucasus, however, in August 1964, the city's name was changed to Togliatti, in honor of the late leader of the Italian Communist Party, Palmiro Togliatti.

It was from this city that the history of the most famous car in the history of the former Soviet Union began, and political considerations were not lost on the history of its construction (in commemoration of the 100th anniversary of the birth of the founder of the Soviet state, Vladimir Lenin), and even on the choice of the shape and specifications of the car (box) that accompanied it for dozens of years. .

Although the eyes of the Soviet engineers at the time fell on the French "Renault 16" to be the mother model of the upcoming Soviet car, due to its novelty in some aspects, such as front-wheel drive, the metal head, and the practical hatchback structure, the choice, however, fell on the Italian "Fiat" company. .

For political reasons, the contract did not go to Paris, and the bid was reversed for Fiat when then-General Secretary of the Communist Party Leonid Brezhnev famously said, "Comrades engineers, stop dealing with technology, we will deal with politics... Italy is closer to us than France."

AutoVAZ may need many months to return to the production of models that are less dependent on foreign spare parts and electronic components (Reuters)

Khadesh name for modesty

The real name of the new car is "Jigoli" and not "Lada", as it is known in the world, and it belongs to the Zhiguli Mountains located on the right bank of the Volga River not far from the city of Samara.

But the Russian designation was not appropriate for the pronunciation features in most European countries, and even obscene in some languages, such as Hungarian and French, so in 1975 all the cars exported were renamed Lada.

But even with the word Lada, marketers miscalculated. In France, the car model has become synonymous with ladre, which means mean or greedy.

At the epicenter of guerrilla warfare

After the collapse of the Soviet Union, AvtoVAZ seemed to be the only institution in the country that manufactures products that everyone needs, and various organized criminal groups were fighting among themselves over the theft of cars or buying them at low prices, so the factory found itself in the epicenter of guerrilla warfare, and entered - as a city All my assumptions - in the labyrinths of settling accounts to realize the dream of controlling the factory.

At first, these gangs were unable to penetrate the factory itself, but they got their hands on its spare parts store and its supply channels, and they controlled the volume of production, prices and sales destinations, before a bloody war broke out between these groups, resulting in the killing of about 400 people.

As for the historical moment, it began after one of the organized gangs managed to gain access to what was called the “fold” of the factory, and the “thieves” began to obtain a percentage of the sales, as their income was estimated from 10% to 20% of the total profits.

The royalties also affected intermediary companies that were engaged in selling cars at preferential prices, after they became interesting to the extortionists who charged them.

As a result of a long and bloody war with these gangs carried out by the security services, the factory was restored to its previous state, and withstood the economic crisis that the country experienced in the 1990s, and eventually culminated in the French car giant Renault's acquisition of the factory.

A few years did not pass until the company entered again into a state of deflation and did not achieve convincing profits due to weak competitiveness, despite its acquisition of about 20% of the local car market, and with the sword of sanctions reaching its "neck", it became certain that the bet on increasing export rates To increase profits has become almost impossible.