The FSO Warsaw car factory might not survive 2009 without external support, as its output is dropping and 650 staff will be made redundant before the end of the year. According to Samar, the plant produced 20,400 cars by the end of the May, which is 72.7% less than in 2008. In May alone the firm produced only 422 units of Chevrolet's Aveo and afterwards suspended operations due to a lack of orders.

A restart of operations is not expected before the second half of June and in the meantime the management board is looking for ways to obtain aid from the Polish government. It had placed much hope in the document approved last month, according to which Industrial Development Agency (ARP) would grant loans to enterprises. "Regretfully the automotive sector was crossed off the list of companies which ARP will support in the first run," said Janusz Woźniak, president of FSO.

The ARP and Economy Ministry did not provide a clear answer as to whether FSO would be included on future lists. "We have orders to the end of the year, even though they are not as large as we would like them to be. I cannot exclude that in the following months there will be another production halt," said Janusz Woźniak.

Source: Puls Biznesu