GAZ Group Will Receive 8.6 Billion Rubles From The State

2023 Author: Natalie MacDonald | [email protected]. Last modified: 2023-11-26 13:59

The Ministry of Trade and Industry of the Russian Federation proposed to increase state support for the GAZ group, which is currently under US sanctions, which is why it is experiencing financial difficulties. The manufacturer plans to allocate 8.6 billion rubles by the end of 2021, Kommersant reports.

• The Ministry of Industry and Trade presented a draft amendment to the rules for reimbursing Russian auto concerns of part of the cost of paying interest on loans attracted in 2015 to refinance existing loans. The amendments will allow the concern to reduce costs, which have increased after the company came under US sanctions imposed on Oleg Deripaska, the owner of the GAZ group.
• In 2019, the company has already received 3.3 billion rubles for these purposes. Another 2.64 billion will be allocated for 2020 and 2021. The amount may be adjusted, because in April the manufacturer asked to allocate 9.5 billion rubles for this. The car plant also received a state order, under which it undertakes to deliver 789 ambulances and more than a thousand school buses to the regions. With the order, the company will gain 2.4 and 1.7 billion rubles, respectively.

In April, the GAZ group asked the state for support in the amount of 29.5 billion rubles. The company explained the need for financing by the risk of a decrease in production by 40 percent and the inability to service the loan portfolio amid US sanctions, which could ultimately lead to bankruptcy. The decision to extend or lift the sanctions is going to be announced on November 6, 2019.