The serfs of the Volga Car Factory

The Volga Car Factory in Togliatti is the biggest in Russia. The management recently announced 7,500 redundancies, all before the end of the year. How are the city and its inhabitants coping? на русском языке

Valery Pavlukevich
19 March 2014

Togliatti is the second biggest city in the Samara oblast on the Volga, 70km from the capital of the same name. It has 719,000 inhabitants and its largest employer is the Volga Car Factory (VAZ in Russian), the biggest in Russia. Driving along the highway into Togliatti the first thing you see is the city’s name spelled out in large metal letters beside a giant model of the Soviet Order of the Red Banner of Labour, awarded to the city in 1987 for its outstanding industrial achievement. Further along the road are nine or 12-storey high-rise blocks that also go back to Soviet times, the beginning of the city. Many of the car factory’s 67,000 workers live in blocks like these. 

On 14 January 2014 a 58-year old Swede called Bo Andersson became CEO of the Volga Car Factory. Eight days later he announced that 7,500 redundancies would take place this year, among both office and factory staff. Managers, specialists and other staff will be reduced by 20% (2,500 people) and 5,000 shop floor workers will lose their jobs. The names of the first 1,500 redundancies have already been announced, and the whole of Tolyatti is buzzing with the news. 

One man’s story

On a visit to a supermarket to check out what locals were buying, I got into conversation with Aleksey Petrovich Solovyov. The 55-year old engineer, who works on VAZ’s Lada Granta production line, was with his six-year old grandson Misha. 

cc Yuryi Abramochkin via RIA 460_0.jpg

Workers on the production line can't even go to the toilet because there is too much to do. Photo cc:Yuryi Abramochkin

The names of the first 1,500 redundancies have already been announced.

Solovyov has a university education and considerable experience. At VAZ, where he’s been for over 20 years, he works alternate day and night shifts in charge of quality control on the assembly line and also keeps computer records on the mainly young people (average age 22) working there. Quality is very strictly monitored, working conditions less so: in summer the temperature on the shop floor can go up to 40C. For reasons of economy the air conditioning system isn’t always switched on; it breaks down fairly frequently anyway and some years ago there were several cases of heatstroke. The trade union looks after workers’ rights, but complaints are rare: people who complain can face the sack and unemployment levels in Togliatti are high so finding work is not easy, especially for young people. As a military veteran and an experienced worker, Aleksey Petrovich earns 20,000 roubles per month (£330), slightly less than the national average, and with his wife a pensioner, two children and two grandchildren, it is hard enough to make ends meet.  He is also supporting his younger daughter, who is 20 years old and at university, so not earning. The rent on his one- bedroom flat is 3,500 roubles (£58) a month.  ‘It’s a good thing that there are meters for hot and cold water and gas; you can keep an eye on how much you use. But the prices still go up at least once a year.  Our income covers only rent and food, so the last big purchase – a laptop for my daughter – was bought on tick,’ he says.

I ask Aleksey what he knows about the redundancies.

He says that at the beginning of January the management offered him the opportunity of voluntary relocation to another job in his production department, but he refused. He said that workers who took voluntary redundancy before the end of February were promised five months’ wages in compensation. Anyone going in March would be paid four months’ wages, and in April the amount would be reduced still further, to three months’ pay. No new workers are being taken on at all.

They live mainly off potatoes and pasta these days.

Aleksey Petrovich thinks that in future the work force will be reduced to some 1,000 people, from the 70,000 there today. ‘It will all be robots and automata.  But what’s to happen to the workers who’ve been made redundant?  No one thinks about that,’ he says, going off to buy cheap potatoes with his grandson. They live mainly off potatoes and pasta these days. I looked at the prices: potatoes are 25 roubles (£0.40) a kilogramme and 500 grammes of pasta costs the same. 

A taxi that isn’t a taxi

I leave the supermarket and go to the bus stop.  One trip on public transport costs 20 roubles. While I’m standing there, carskeep stopping and offering their services as taxis. These are private drivers trying to make a bit of extra money. I start haggling with one of them, who offers to take me to another district in the city for 150 roubles (£2.50), which is cheaper than a taxi in Samara and much cheaper than in Moscow. I get in.

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The future of workers at factories like VAZ is uncertain as more and more are using robots. Photo cc: Heise

My driver is called Andrey and I was right - his main employment is at the car plant.  I express surprise that, just as 20 years ago, everyone still works there. ‘No surprise at all,’ says my driver. ‘It’s the chief employer in the town.’

His monthy pay at the plant comes to about 16,000 roubles (£265).  He’s 25 and has been working there for five years.  ‘My assembly line job is not difficult – I screw suspension components onto the body.’ I ask him about the redundancies. He, like everyone else there, has heard about them; if he’s forced to resign ‘by mutual agreement’ and take the redundancy package, then that’s what he’ll do. He’s sick of working there.

'Assembly work is boring and monotonous.'

‘Assembly work is boring and monotonous. You can’t leave the production line, even to go to the toilet, because there’s too much work.' The facilities for the workers are minimal: in the canteen night shift workers get the mashed potato and pilaf left over from the daytime menu. Though in January, after Bo Andersson spent some time in a factory canteen and had the standard dinner alongside the workers, the quality of food did actually improve. There was more butter in the buckwheat kasha and the tea was better. You can read on the internet that wages at the factory start at 25,000 roubles (£415) a month, but that’s a lie. The figure is more like 12-18,000 roubles (£200-300)’, says Andrei.

I ask him what he’ll do if he has to leave and he replies that he’ll go to Samara and do taxi work there. ‘I’ll work on that till the summer, then I’ll go to my parents in the country and get a job driving a combine harvester. In the autumn I’ll stockpile potatoes and live there in the village. I’ve got a girl there,’ he says.

While we’re on our way, Andrey tells me what he thinks about watching the Winter Olympics in Sochi.

‘It’s making a mockery of us, putting on the Olympics in such a poor country.’

‘It’s making a mockery of us, putting on the Olympics in such a poor country. There’s a poster at the bus stop advertising tourist trips to Sochi: the cost for five days is 280,000 roubles (£4,630)!  Where would an ordinary person get money like that? I read on the internet that each and every person in Russia could have been paid two million roubles out of what it cost to put the games on. That’s what they should have done!’

I ask the young man where he gets his information about what’s going on in Russia and the world?  He apparently only turns on the TV for the sport, everything else he gets from the internet on his smartphone. He never went to university, but he knows his politics: the opposition, human rights, TV Rain. He has little hope of stability in his work at the car factory, adding that Russians are used to relying on themselves and it would be better to live in the village where life is simpler. 

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The expense of the Sochi Olympic Games was seen as an insult by some VAZ workers. Photo: Atos International

‘But what about the future of VAZ, that the government’s always talking about?’ I ask Andrey. ‘In July 2012 Nikolay Merkushkin, the Samara oblast governor, bought a white LADA Largus from an official factory dealer for 449,000 roubles (£7,430).  He wanted to show an example, that people should should buy Russian.’ 

‘Typical PR job. I’m sure that Merkushkin didn’t buy a standard car, but one that had been specially well built, checked and tuned.  Factory workers joke about the ordinary cars that you have to spend the first week after you’ve bought a car tinkering with it so it’ll go properly,’ says Andrey.

At which point we arrive.

Trade unions

Now I wanted to find out about the situation at the factory from Petr Zolotaryov, leader of the independent ‘Unity’ union for the last 20 years. There’s an official union, to which 90% of the workers belong, a powerful bureacratic machine which rubberstamps management decisions. The independent union, however, defends workers’ rights, including in court if necessary, and monitors working conditions and compliance with the Labour Code. Traditionally it's this union that monitors redundancies too. 

Zolotaryov is the chairman of the union. He tells me that at the beginning of February his organisation had not been officially informed by the management about the planned redundancies.

‘People have become passive and are sick of defending their rights.'

‘The management invited workers to take voluntary redundancy. For this they should be offered compensation,’ he says.  His union is against the redundancies. ‘They can’t make workers redundant without cutting the costs of the directors.  Last year 12 members of the board received bonuses on top of their salaries amounting to 337 million roubles (nearly £5.6 million). The factory’s top managers have to give up their luxurious houses and flights to Moscow in private planes. The workers taking voluntary redundancy are being offered miserly compensation. They ought to be getting twelve months’ wages – that way they’ll have enough money while they’re looking for a new job.’

‘Factory workers here are treated like serfs in Tsarist Russia!’

The leader of the independent union is unsure whether he will be able to mobilise the workers to strike. ‘People have become passive and are sick of defending their rights. Workers shouldn’t be afraid to join an independent union, to take part in demonstrations defending their right to work. They’re scared that if they support “Unity” they could be sacked. I only have 1500 members,’ he says.

Before I leave Togliatti I go into a small café to have something to eat. A TV screen on the wall is showing Togliatti news. The newscaster is joyfully saying that all the 7,500 people being made redundant have already been offered employment in the Far Eastern Federal District, whose Development Ministry has asked the Samara governor Nikolay Merkushkin and Bo Andersson to investigate the possibility of relocating the redundant factory workers to their region.

‘Factory workers here are treated like serfs in Tsarist Russia!’ says the only other person in the empty café. 

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