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twenty-first century. The subcompact Lada Granta was Russia’s highest selling car model in June 2022, followed by the Lada Vesta. But even they were made with the help of Western carmakers until the war intervened.
Ladas are produced by Russia’s largest carmaker AvtoVaz, which was until recently majority owned by France’s Renault. In his article The Great Escape, Professor Thane Gustafson explains how the notorious former Renault CEO Carlos Ghosn contributed to the digital revolution of cars in Russia by bringing the “spoke and wheel” model of manufacturing to AvtoVaz. High-tech components were made in France and shipped to AvtoVaz plants for assembly using cheaper Russian labour.
In 2009, Ghosn was boasting that Russia would soon be Renault’s largest market as he prepared to increase his stake in AvtoVaz.
But production at AvtoVaz was paralysed by sanctions after the war started, with all the manufacturer’s staff released on vacation from April 4-24 2022. Renault sold its stake in the carmaker to NAMI state automotive engineering institute in April, reportedly for the symbolic price of one ruble. As part of the deal, it retained the right to buy back its Russian assets within six years.
Going offroad Meanwhile, Russia is keen to show that AvtoVaz and other carmakers can cope just fine without the Western components they got accustomed to ordering.
In an attempt to jump-start the car market, authorities relaxed safety standards in May, scrapping the requirement for airbags and seatbelt pretensioners, anti-lock braking systems (ABS) and lowering emissions standards.
When it re-started production of its popular Granta model in June, Lada offered only manual transmission, and a host of digital components were missing, including the electronic stability control system. Until late July, new Lada cars were reportedly missing air-conditioning systems.
When news broke that Renault was leaving Russia, speculation about the future of AvtoVaz was rife. The company’s flagship complex in Togliatti employs over 32,000 workers, who have all been on a four-day working week since April due to shortages of components.
Moscow Mayor Sergei Sobyanin trumpeted Renault’s handover of AvtoVAZ as a triumph for the workers, suggesting that it would protect Russian jobs. Renault Group CEO Luca de Meo emphasised the same thing, insisting that “we are making a responsible choice towards our 45,000 employees in Russia.” Russia’s car industry employs around 1% of the country’s workforce, and hundreds of thousands of jobs are at risk due to the slowdown. When a contingent of workers from Russia’s iconic truck builder GAZ drove to
133 RUSSIA Country Report October 2020 www.intellinews.com