Volkswagen will cut production and jobs at the Russian plant in Kaluga

Volkswagen said it would allow the layoff of at least 150 workers at a Russian car plant in Kaluga. VW said the plant will operate four days a week from April to July 2015, while the number of shifts will be reduced to two from three in May. The company also said production will be suspended for two weeks from May 5 to May 8 and May 12 to 15.
VW Group produces Audi A6, A7, A8L, Q5, and Q7 along with VW Polo and Tiguan and Skoda Fabia and Octavia models in Kaluga, in accordance with the program of the European car assembly plant.

Daniel Schwartz, an analyst at Commerzbank in Frankfurt, said "We expect another passenger car market to shrink by about 25 percent in Russia this year. This cut in production capacity makes sense." The company said that VW has already sent more than 100 workers from Russia to Germany for training and will be forced to transfer some employees from Kaluga to a nearby engine plant or to the company's facilities outside Moscow.

VW says it will stick to its investment plan in Russia as it counts on the long-term potential of the market as promising. Sales of VW vehicles in Russia fell 27 percent to 27,527 in the first two months of this year, according to the Moscow-based Association of European Businesses. The group's market share is 11.3 percent, making it the second largest group by sales after the Renault-Nissan-AvtoVAZ alliance. VW is a Western automaker that is trying to change the situation caused by economic sanctions against Russia, which impede the company's growth.