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Ford in talks to cut work week at Russia plant

ST PETERSBURG, Russia, April, 2 (Reuters) - U.S. carmaker Ford Motor Co F.N is in talks with unions to cut the working week at its sole Russian assembly plant to compensate for expected falls in demand, a Ford spokeswoman said on Thursday.

“As we forecast continuing overall declines in sales of new cars on the Russian market, Ford ... is proposing to cut the work week to four days, as we did at our European plants,” Ford spokeswoman Yekaterina Kulinenko said by email.

She said that under Russian labour laws it would take two months to put a cut into effect from the day the order is given to cut the week at the plant in Vsevolozhsk, just outside St Petersburg. “There has been no order yet.”

The union at the plant issued a statement protesting the proposal.

“The union committee believes the company is conducting its business in bad faith in the financial crisis by imposing a partial work week, and (the union) retains the right to appeal to the regional government ... to investigate the situation at the plant,” the union said.

The government of Prime Minister Vladimir Putin, facing rising unemployment, has told Russian carmakers not to emulate U.S. car giant GM in making heavy job losses at its plants.

Putin’s government has also suggested foreign carmakers with operations in Russia were technically eligible for government aid to the industry.

Russian media have reported that Ford reduced the price of the Russian-assembled Focus to a level just below the cut-off point for state subsidies on car loans.

The plant had been planning to produce 100,000 Focuses and recently launched assembly of the mid-range Mondeo at the Vsevolozhsk plant. It had planned to produce 25,000 Mondeos.

New car sales have fallen 36 percent in Russia this year, with 252,314 sold in January and February, the Association of European Businesses has said. Last year, 3.2 million automobiles worth a total of $69 billion were sold in Russia.

Ford shares rose were up 6.57 percent at 1623 GMT in New York on Thursday on better-than-expected sales in the United States and Europe. [ID:nNL2938160] (Reporting by Denis Pinchuk; writing by Melissa Akin, editing by Will Waterman)