MOSCOW, April 1 Ford Sollers, a joint venture
between U.S. automaker Ford Motor Co and Russian carmaker
Sollers is cutting 700 staff in its plant near St
Petersburg due to Russia's deteriorating economy and weaker
rouble, the company said on Tuesday.
Ford Sollers employs around 5,500 people around St
Petersburg and in Tatarstan. The company said the move was also
due to lower Russian auto sales and lower demand for "C-segment"
cars, referring to compact cars such as its Ford Focus, which
are made at its Vsevolozhsk plant near St Petersburg.
Car sales have faltered in Russia as economic growth has
slowed, causing people to put off large purchases. Car sales
fell 5 percent in 2013, according to lobby group AEB, which is
forecasting another weak year because of the fragile economy.
The rouble has dropped 7 percent this year as investors
price in the risk of Russia's annexation of Crimea and economic
retaliation from the West. The falling rouble reduces consumers'
purchasing power and makes it more expensive for automakers to
buy parts from abroad.
Formed in late 2011, the Ford Sollers venture produces the
Ford Kuga, Ford Explorer, Ford S-MAX, Ford Galaxy, Ford Transit
and Tourneo Custom, as well as the Focus and Mondeo models in
Russia. It has announced plans to add the Edge and EcoSport SUV
models from 2014.
(Reporting by Gleb Stolyarov, writing by Megan Davies. Editing
by Jane Merriman)