(Reuters) -Giant Russian tank and freight railcar manufacturer Uralvagonzavod (UVZ) said on Friday it was restructuring its operations to reduce costs after a local media report said it planned to cut the number of its employees by up to 10%.
Located in the city of Nizhny Tagil around 1,400 km (870 miles) east of Moscow, the Uralvagonzavod factory has been sanctioned by the West over its role in supplying tanks for Moscow’s war in Ukraine.
The factory, which is run by a state conglomerate controlled by one of President Vladimir Putin’s allies, has publicly said it produces T-90M battle tanks and modernises T-72B3M tanks.
Citing an internal document, local news outlet E1 reported earlier on Friday that UVZ planned to make cuts in staff across various departments of up to 10% by February of next year and to stop new hiring.
Asked about the report, UVZ said in a statement to Reuters:
“In the current environment, like any other enterprise, UVZ is carrying out restructuring, primarily aimed at optimising administrative and management expenses.”
UVZ continued to work “at high intensity” to fulfil a state defence order, it said. New hiring also continued.
Some staff at the plant were moved to a four-day work week last month as the company grapples with a decline in demand for freight railcars due to a steep fall in cargo volume caused by disruption to some exports.
Russia’s biggest industrial companies, including automakers and mining and metallurgical companies, are putting employees on furlough or cutting staff as the war economy slows, domestic demand stalls, and exports dry up, sources and companies have told Reuters.
(Reporting by Gleb Stolyarov; Editing by Andrew Osborn)
