Russian carmaker AvtoVAZ (AVAZ.RS) said Monday it will spend RUB42 billion ($1.42 billion) in the "near future" on a new line of cars based on Renault SA's (RNO.LN) Logan model.

France's Renault and sister company Nissan Motor Co. Ltd (7201.TO) are expected to provide up-to-date technology for the modernization of AvtoVAZ production, Russian Deputy Prime Minister Igor Shuvalov said in a release from the carmaker.

Renault said last week it would provide additional support to AvtoVAZ, although not necessarily in the form of cash, after the Russian government vowed to boost its bailout of the loss-making firm.

AvtoVAZ, which is 25% owned by Renault, will concentrate on producing a car based on the low-cost Logan platform.

AvtoVAZ Chief Executive Igor Komarov and other Russian car chiefs are meeting with the government today to discuss support for the industry.

AvtoVAZ's liabilities as of June 30 exceeded its assets by RUB52.8 billion, it said Monday on its Web site. Short-term debt totaled RUB58.22 billion.

AvtoVAZ, maker of the boxy Lada sedan, made almost a quarter of the cars sold in Russia in 2008, and the industry slump has pushed the company toward insolvency. This has forced management to address long-standing inefficiencies -- chiefly its bloated work force and outdated product range.

-By William Mauldin, Dow Jones Newswires; +7 495 937 8445; william.mauldin@dowjones.com