Deepika Agrawal 
Six months after Volkswagen made an exit from Russia, furloughed factory workers at the company’s former car plant are being offered redundancy, according to the union representing them. The plant is currently idle and will remain so until at least March 2024 as the new owners struggle to find a partner to resume output. Thus, they are now offering three months’ pay to works who are willing to quit. Those who have been employed for long are also being offered bonuses in order to encourage them to leave their jobs.
Idle factory workers
Around 3,600 workers at the idle plant are currently being paid two thirds of their salary under the furlough scheme. This makes for a little more than 50,000 roubles (USD 562) a month on average, Elena Kryukova, head of the MPRA trade union’s plant committee, told Reuters. Only a few of them have so far accepted the redundancy offer made by the new owners. The others pass their time by sitting in recreation rooms, walking around the plant and socialising, Kryukova said.
Volkswagen’s exit from Russia
The plant, which is located in the Kaluga region south of Moscow, saw work coming to a standstill after Russia’s invasion of Ukraine in 2022. Following this, the German automaker stopped operations at the plant and suspended imports. In May this year, the automaker finalised the sale of the plant and its local subsidiaries to Art-Finance, supported by auto dealer group Avilon. The factory was later renamed to AGR Automotive. Though the sale price was not disclosed, Reuters reported, quoting sources, that the deal was valued at 125 million euros (USD 137.14 million). The factory has an annual production capacity of 225,000 units.
After the exodus of Western automakers from Russian following its invasion of Ukraine, Chinese car sales in the country appear to have peaked, as per data examined by Reuters. However, recent growth in the market may stall as high import costs and interest rates begin to bite.
While many automakers sold their assets in Russia for a nominal fee, they also inserted buyback clauses that could one day allow them to return. However, the Russian government has confirmed that Volkswagen did not insert any such scheme while selling its plant. The automaker, however, sold its assets for a lucrative amount.
