VW said in March that production at its Kaluga and Nizhny Novgorod sites would be suspended until further notice because of Western sanctions, and vehicle exports to Russia would be stopped with immediate effect.
While VW owns its Kaluga plant directly, employing around 4,200 workers there, it does not own the Nizhny Novgorod plant but has a contractual agreement with owner GAZ Group to assemble its models there.
The U.S. treasury department in January shortened two licenses for GAZ Group, which has been sanctioned since 2018 but given licenses for certain transactions, due to Russia’s gathering of troops on the border with Ukraine.
Kommersant cited union sources as saying that employees who agreed to the company’s offer before June 17 would receive six months’ salary.