For decades, Avtovaz’s Lada model dominated the Russian car market, recently one of the largest and fastest growing in Europe. But as a result of chronic mismanagement and Russia’s economic crisis, Avtovaz is now in a downward spiral from which it might not recover.

Avtovaz’s sales – which totalled 800,000 last year – have plummeted and debts are mounting. A government bail-out in June totalling Rbs25bn had no noticeable effect on the company’s fortunes, and debts now total Rbs62bn ($2.1bn), compared with projected sales in 2009 of about Rbs88bn.