Anastasia Gorbacheva13:21, 22.07.25

Chinese competitors are capturing the Russian market.

Russia’s largest automaker AvtoVAZ said on Tuesday it may cut its workweek to four days from five, a last-ditch move as high interest rates and competition from China are cutting its sales.

Reuters reports that last month AvtoVAZ, which is struggling to find enough buyers for its cars, said it expected sales in the Russian car market to fall by 25% this year, citing high central bank interest rates that are reducing appetite for auto loans and raising production costs as the main problem.

“We are talking about a high key rate and stricter regulatory requirements for borrowers on car loans. In addition, a significant number of cars were imported into Russia, and imported brands are pursuing a policy of price dumping,” the company said in a statement.

AvtoVAZ employs more than 30,000 people, mostly in Togliatti. In the first half of this year, the company’s sales fell 25% to 155,481 units, according to Avtostat.

The company switched to a four-day workweek for three months in 2022 after Western sanctions forced foreign automakers out of the market. Sales of its flagship Lada car fell 48.2% that year to 174,688 units.

Russian domestic production was heavily dependent on foreign manufacturers, and the market collapsed in 2022 before the rapid arrival of Chinese automakers revived it. Chinese competitors now account for more than 50% of sales in Russia, up from less than 10% before the full-scale invasion of Ukraine.

It is worth noting that, if the decision is made, the shortened work week will come into effect at the end of September.

Russian auto industry – what is known

Last year, the Russians presented a new model from AvtoVAZ, called the Lada Iskra . It is positioned as “something in between Granta and Vesta.” It is known that the Lada Iskra was built on the CMF-B-LS platform from Renault-Nissan, on which some other cars were created.

Also last year, the Russians showed off new Volgas, but the cars actually turned out to be Chinese developments. The only thing that distinguishes them from the original Chinese models is the chrome grille.

(C)UNIAN 2025