MOSCOW, October 15 (RIA Novosti) - The Russian Industry Ministry has reversed its position on a state rescue of carmaker AvtoVAZ since advising the government that a bailout would be useless, the prime minister's spokesman said on Thursday.

Dmitry Peskov confirmed newspaper reports that ministry experts had concluded there was no point in pouring state funds into the struggling Russian auto giant, but said the letter was out of date.

"The reports of the mentioned publications are true only to the extent that the Industry and Trade Ministry letter with the summary of its position existed, but missed an important fact. This letter was written long ago," Prime Minister Vladimr Putin's spokesman said.

Kommersant business daily reported on Thursday that the Industry Ministry concluded that the government should not bail out AvtoVAZ, the country's largest carmaker.

The expert report, requested by First Deputy Prime Minister Igor Shuvalov and sent to the government about two weeks ago, looked at whether the government should allocate up to 70 billion rubles (around $2 billion) to rescue the ailing car giant from closure.

According to the newspaper, the report concluded that the car giant was effectively bankrupt and it would be useless to pump money into it. The ministry added that the situation could be remedied only by dismissing as many as 50,000 of the 100,000-strong workforce and proposed spending money on stabilizing the situation on the labor market in the Samara Region in the Volga area where AvtoVAZ is located.

The paper described the conclusion as the first objective assessment of the situation around AvtoVAZ, but said it was unlikely to be supported by the government. Putin said on October 5 that the government would never allow AvtoVAZ to collapse.

AvtoVAZ has production capacity of over 800,000 vehicles annually. It has made more than 25 million Lada cars since it was established in 1970 as a joint project with Italian carmaker Fiat. The company currently produces 15 models priced between 150,000 rubles ($4,800) and 350,000 rubles ($11,240).