Ermishin's resignation called for in the wake of recent failures (364 words)

Published: 3/12/2001

According to reports, Dmitry Ayatskov, Governor of the Saratov region, has met with employees of the Saratov Aviation Plant (SAZ) and has announced that the plant may soon be renationalised and again become a state unitary enterprise. Ayatskov believes that the move would be helpful in gaining the plant work from the State. The workers at the plant are to give their opinion of privatisation at a meeting on 26th April. They are unlikely to object to the move, given that their stock holdings in the company are currently trading at 48 rubles, despite a par value of 100 rubles. They are seeing average wages of 300 rubles a month. The workers' confidence in management has recently declined markedly, after a public attack on Alexander Ermishin, the company's General Director, by Alexei Shuvalov, the region's Deputy Chairman, at a recent meeting of the regional government. Shuvalov called for Ermishin's resignation, so signalling his personal responsibility for the fact that only 20% of the plant is currently utilised, with large areas rented out to producers of anything from boats to water purification equipment. In addition, Saratov's 5,000 workers are suffering salary losses and the various plans to improve the situation had been ineffective. Shuvalov stated that Ermishin should stop blaming the federal government, the Saratov regional administration and investors (despite the reluctance of all three to provide the plant with badly needed investment) and accept the plant's problems as being his fault - and resign. It seems likely that given the ferocity of the attack from the regional government, Ermishin will be forced to do so. Blaming the General Director for all the plant's ills may be more than a little unfair, given the slump in demand for its core product, the Yak-42, and the failure of other projects - such as the Yak-48 executive jet and the Tupolev regional airliner, the Tu-414 - to get off the ground due to lack of funding. The plant has attempted to come up with some product innovations with the higher spec. Yak-42D-120 and the smaller 90-seat Yak-42D-90, targeted at regional carriers.

Article ID: 2409