MOSCOW: Russia on Monday said it would pump around $425 million into fuelling its crisis-hit automobile industry as Volkswagen became the latest manufacturer to cut back operations in the country. Prime Minister Dmitry Medvedev announced the plan to boost the beleaguered sector that has seen sales plummet on the back of economic turmoil in Russia caused by falling oil prices and Western sanctions over Ukraine. The funds – some 25 billion rubles or €390 million – will go towards cutting credit costs for cars and the purchase of new vehicles by government bodies, Medvedev was quoted as saying by Russian news agencies. “If there are no support measures taken the market will fall by 50%,” industry minister Denis Manturov warned. The announcement of the government’s intervention to bolster the stalled auto industry came as Volkswagen said it would cut around 150 temporary staff and reduce the number of shifts at its Kaluga plant in western Russia.
Published in The Express Tribune, March 24th, 2015.
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