Russia’s OAO AvtoVAZ renews its warning that it will be forced to seek bankruptcy protection unless it can restructure its debt and/or receive significant financial aid.

The company says production plans for its huge facility in Togliatti won’t generate enough cash to service its $3.6 billion of short-term debt. AvtoVAZ wants its state-owned bank lenders to provide an additional $1.7 billion by buying new convertible bonds.

AvtoVAZ posted a $660 million net loss in the first half of 2009 and expects a full-year loss of $1.2 billion. Unit sales of the company’s Lada cars are down 43% this year.

Moscow has been pressuring Renault SA, which owns a 25% stake in AvtoVAZ, to invest more. But CEO Carlos Ghosn has repeatedly said that Renault will provide technology and management support but not cash. AvtoVAZ is due to get two vehicles based on Renault’s low-cost Logan sedan and an unspecified vehicle derived from a model currently produced by Nissan Motor Co.

AvtoVAZ plans to cut 21,700 jobs by 2012 on top of the 6,000 it already has trimmed. The cutbacks apparently were suspended temporarily at the request of government officials, but Russia’s deputy industry minister said last month that the company needed to reduce its workforce by 50% to avoid collapse.

There has been considerable debate within Russia about how many jobs must be cut at AvtoVAZ. The central government insists it will retrain and find new jobs for all affected workers.

ZAO AvtoTor has begun assembling Opel vehicles (the Astra small car and Zafira MPV) at its factory in the Baltic port city of Kalingrad. Initially production consists of completing painted car bodies shipped from Germany. The company plans to eventually weld and paint vehicle bodies locally.

GM and AvtoTor are investing $75 million at the plant through 2011 on upgrades to make the Opel vehicles. AvtoTor says Magna International Inc.-which is in the process of buying a majority stake in Opel/Vauxhall with partner OAO Sberbank-has assured it that production in Kalingrad would continue if the deal goes through.

AvtoTor assembled 110,000 vehicles last year, including more than two dozen models of cars, trucks and motorcycles for BMW, General Motors and Kia. Output this year is down 43% through September, reflecting the sharp decline in the Russian market. AvtoTor has been working with GM for six year and now builds several Cadillac, Chevrolet and Hummer models from kits.

China’s Zhejiang Geely Holding Group Co., the parent of Geely Automobile Holding Ltd., is confident its bid for Ford Motor Co.’s Volvo Car unit will be successful. Chairman Li Shufu adds that the talks are still at an early stage, telling Reuters, “We’re taking our time.”

The companies have been in talks for several months, and Ford named Geely as the preferred bidder last week. Geely Auto is not directly involved in the pending purchase. But officials say the company likely would explore cooperation opportunities with Volvo to help it improve its technology. This would help it target China’s growing luxury segment and expand into other global markets .

Ford says it will not retain a stake in the Swedish company. It also insists that any sale must maintain current product development, manufacturing and component sharing ties. Hangzhou-based Geely says its proposal, financed by Chinese banks, would maintain management independence, union agreements and dealer networks. It also vows to keep existing production and research and development facilities in Sweden. Analysts say Geely is likely to move at least some Volvo production to China.

Last month media reports indicated the sale to Geely was in jeopardy due to concerns over intellectual property rights. It isn’t clear if those issues have been resolved. Members of the Swedish supplier group FKG have threatened not to supply high-value components to a Geely-owned Volvo unless the Chinese company agrees not to copy their technology.

Ford bought Volvo for $6.45 billion in 1999. Reports say Geely has offered nearly $2 billion to buy the unit and might invest another $3 billion to revive it. In September Geely said it also might seek a Swedish partner to help win government-guaranteed loans. It is not clear if the company still plans to do so.

Geely Automobile has seen a more than four-fold jump in its stock this year on hopes for the Volvo bid and a recent investment by Goldman Sachs. On Friday the stock hit a record high HK$3.04 before closing down 3.1% at HK$2.84.

Several other companies had been vying for Volvo, including Beijing Automotive Industry Holding Co., a Swedish investment group called Konsortium Jakob AB and the Crown consortium headed by turnaround veteran Michael Dingman. Konsortium Jakob has said it still intends to make a bid.

Nissan Motor Co. says its sales in China grew 35% to 541,400 vehicles through the first three quarters of 2009, making the country its second-largest market. Year-on-year sales in October surged 63% to 75,200 units, setting a new monthly record for Nissan in China.

Passenger cars accounted for sales of 400,600 units, up 47% from the same period last year, from January through September. The volume already has surpassed Nissan’s full-year China total for 2008 of 384,800 cars.

Batbold Sukhbaatar, one of Mongolia’s wealthiest men, was confirmed as the new prime minister of the impoverished nation on Friday by the parliament. He succeeds Bayar Sanjaa, who stepped down due to health problems.

A former foreign minister, Batbold pledges to continue the pro-business policies of his predecessor. The 46-year-old graduated from the University of Moscow’s School of International Relations in 1986. Batbold amassed his fortune in the 1990s as head of Altai Trading Co. Ltd., which formed a gold mining joint venture with Canadian Centerra Gold Inc. Altai Trading is now managed by Batbold’s wife.

Batbold’s appointment comes weeks after Mongolia inked a $4 billion deal with London-based Rio Tinto and Canada’s Ivanhoe Mines to develop a gold and copper mine in the Gobi desert. There had been a contentious national debate over how to exploit Mongolia’s mineral wealth. Opponents complained the deal shortchanged Mongolia.

Batbold’s Mongolian People’s Revolutionary Party, which ran Mongolia as communists until 1990, holds 46 seats in the 76-seat parliament. The rival Democratic Party of Mongolia holds another 27 seats. DPM’s Elbegdorj Tsakhia serves as the country’s president, which is a largely ceremonial position.

Wedged between Russia and China, Mongolia has long been wary of foreign domination. It is the world’s 19th-largest country but is one of the most sparsely populated with fewer than 3 million citizens.

Malaysia has announced a new national automotive policy as it seeks to recover from its first recession in a decade. The last national plan was implemented in 2006.

The new program, which takes effect on January 1, ends a three-year ban on production permits for foreign companies. In 2015 it also will scrap the country’s corruption-prone system of import permits. In the past, imports incurred tariffs as high as 300%.

Malaysia has been gradually lowering trade barriers that shielded state-owned Perusahaan Otomobil Nasional Bhd (Proton), which has fallen behind rivals in China and India despite owning Group Lotus.

The new strategy will permit foreign companies to fully own local plants that produce large cars priced above $44,000 and powered by engines displacing more than 1.8 liters. Other provisions call for mandatory annual inspections of vehicles that are at least 15 years old, prohibiting the import of used parts and components beginning July 2011, and incentives for the local production of large components such as transmissions and brake systems. The current 5% levy on completely built-up cars will be maintained; there is no charge for CKD units.

In addition to luring foreign investment, the country also hopes the new policies will make it easier for Proton to attract a foreign partner. Previous efforts to find one, most recently General Motors and Volkswagen, have faltered over issues related to equity and management control.

Proton says it is working to develop better-quality vehicles as it aims to expand into neighboring markets. It’s targeting Thailand in particular to capitalize on the new free trade agreement between the Assn. of Southeast Nations that goes into effect next year. Malaysia’s domestic market has plateaued at about 400,000 vehicles per year.

Next month General Motors Co.’s OnStar telematics system will be offered on select Buick, Cadillac and Chevrolet vehicles in China. It will be the first time the service, which has been available in the U.S. since the mid-1990s, is offered outside North America.

The newly formed Shanghai OnStar Telematics Co. Ltd., a joint venture between GM, Shanghai General Motors and China’s SAIC Group, will market the service. Buyers of OnStar-equipped vehicles will receive one year of free service.

The system will be launched in Mandarin Chinese throughout mainland China with a variety of safety and convenience functions, including automatically notifying emergency providers of airbag deployment and other crashes, diagnostics, stolen vehicle location, remote door unlock and horn and lights activation, roadside assistance, hands-free calling, turn-by-turn navigation and point-of-interest details.

General Motors Co. plans to idle its crossover vehicle plant in Delta Township, Mich., and one of two shifts at a Warren, Mich., transmission plant this week because of a shortage of transmission parts caused by a month-long strike at an Indian supplier.

GM didn’t identify the supplier, but media reports say it is Rico Auto Industries Ltd.-the same company that caused Ford Motor Co. to idle its Oakville, Ont., plant last week. Ford is expected to resume production at the Oakville plant today but may idle it again later this week. Other Ford and GM plants may be affected too.

Workers struck the Rico plant near New Delhi seeking union representation, higher wages and reinstatement of suspended workers. Protests intensified after the death of a striker during a clash last month. Rico has said that it is willing to recognize the union and has been in talks with the striking workers.

Rico supplies transmission parts to Ford and GM for a six-speed automatic the two automakers co-developed. They produce the gearboxes at separate plants in suburban Detroit.

Analysts say the situation raises questions about the stability of using exported parts from India. Transportation logistics and the country’s poor infrastructure also have been problematic for foreign companies.

Volkswagen AG’s Skoda unit says its sales in India zoomed 98% last month to 1,750 units over the same period last year. The Skoda Fabia is produced at a new plant in Pune.

VW, including Audi and Skoda, sold just 1,600 vehicles in India last year. The company aims to nearly double that total this year, increase combined annual sales in India to 30,000 next year and top 100,000 units per year by 2014.

A court in South Korea has issued a preliminary injunction ordering the Korean unit of Russia’s OAO TagAZ not to use or pass along trade secrets stolen from GM Daewoo Auto & Technology Co., which is majority owned by General Motors Co.

Two former GM Daewoo employees, who now work at TagAZ, were arrested last month and charged with providing their new employer with key technical information about GM Daewoo’s Lacetti sedan. Investigators says TagAZ used the data to develop its C-100 sedan, which went on sale in Russia several months ago.

GM Daewoo leads the development of GM’s small car platforms. In September, GM upped its stake in the Korean company to 70%. Other owners are Suzuki Motor, Shanghai Automotive Industry and the Korean Development Bank.