VAZ refused Borisov generators, Minsk region
Workers of the Borisov Plant of Automotive Electrical Equipment (JSC “BATE”) say, the Volga Automobile Plant (AvtoVAZ) refused delivery of a large batch of automobile generators manufactured in Borisov, quoting their unsatisfactory quality.
A delegation of BATE experts was sent to Toliatti however failed to overturn the decision.
This was not the first industrial dispute of the kind. Traditionally, Borisov plant is one of the largest suppliers of starters and generators to the assembly line of VAZ. The Russian auto giant aims to have several suppliers of components and mounts to avoid price dictates and deterioration of quality and to encourage competition among suppliers.
The delivery refusal of generators from Borisov could seriously impair the financial and economic situation at the BATE, particularly during the foreign currency crisis in Belarus.
This Borisov company is one of the largest in the city (3.5 thousand employees), it managed to stay afloat largely because of the secondary market. Given the lifetime of starters and generators manufactured at the Borisov BATE was usually less than the lifetime of a car, there was a steady demand for these products from the owners of old cars from Russia and other CIS countries. Therefore, the affordable price of Borisov starters and generators, and perhaps surprisingly, their relatively poor quality, contribute to their sales at the secondary market. Nevertheless, a temporary moratorium of the AvtoVAZ, the main consumer of the BATE products, on the deliveries of generators, indeed, severely damages the image of the Belarusian enterprise.
According to Belstat, in August 7,600 people were dismissed, including 4,800 civil servants. Dismissals of civil servants were due to the optimisation in the public administration by up to 30%. Some civil servants would retain their job however would lose the status of a civil servant. Vacancies on the labour market are likely to reduce in number, thanks to the optimisation, the state administration would increase wages for public servants. The payroll fund for retained employees is likely to increase and some former state employees are likely to get jobs in affiliated organizations. The optimisation of the state apparatus should complete by January 1st, 2018, and some former civil servants are likely to join the ranks of the unemployed.