Despite Baranov’s efforts, the Germans managed to encircle and destroy the Luga group by 24 August. Von Manstein crushed the Soviet counterattack at Staraya Russa, inflicting heavy losses. Even worse, the OKH transferred General Rudolf Schmidt’s XXXIX Armeekorps (mot.) from Heeresgruppe Mitte to Heeresgruppe Nord to reinforce the final drive on Leningrad. Schmidt’s two mobile divisions, 12.Panzer-Division and 20.Infanterie-Division (mot.) quickly proved their worth by severing the main Moscow–Leningrad rail line and beginning a drive toward the vital rail-junction at Mga, to complete the isolation of Leningrad. Baranov’s tankers continued to assist in repelling German panzer attacks upon Krasnogvardeysk, claiming the destruction of another thirty German tanks by the end of August, but admitted the loss of twenty-eight of their own tanks (eleven KV, four T-28, one T-34, three BT-7, nine T-26). Despite Baranov’s best efforts, Höpner had a significant numerical edge in armour on the Leningrad front by late August and there were no major Red Army tank units left to stop Schmidt’s steamroller advance.
On 30 August, Generaloberst Josef Harpe’s 12.Panzer-Division captured Mga, cutting off Leningrad’s last ground link with the outside world. However, Harpe had not arrived quickly enough to prevent the machinery and thousands of workers from the Kirov plant (
After the Luga position was eliminated, Höpner and Generalfeldmarschall Wilhelm von Leeb, commander of Heeresgruppe Nord, believed that it might be possible to storm Leningrad before its defenses were fully prepared, as Harpe’s 12.Panzer-Division had done at Minsk. Höpner’s panzers were badly depleted and exhausted after ten weeks near-continuous fighting, but the Red Army had fewer than 100 operational tanks left defending the approaches to the city. The Soviet 42nd Army was putting up very stiff resistance at Krasnogvardeysk that stymied Reinhardt’s motorized corps, but Schmidt was advancing on the east side of Leningrad against very weak opposition. Reinhardt massed the 1 and 6.Panzer-Divisionen and 36.Infanterie-Division (mot.) near Krasnogvardeysk and launched an all-out attack on 11 September that finally broke the Soviet defense near Taitsy. The remnants of Baranov’s 1st Tank Division mounted a counterattack against 1.Panzer-Division near Krasnogvardeysk, including Leytenant Kolobanov’s KV-1 platoon, but could not stop the panzers. The Soviet defensive positions began to crumble, with Krasnoye Selo lost on 12 September and Krasnogvardeysk itself lost on 13 September. Baranov’s tankers retreated to the last line of defense before Leningrad, the Pulkovo Heights.
While the rest of Reinhardt’s forces were mopping up the Krasnogvardeysk position, a kampfgruppe from 1.Panzer-Division, consisting of II/Panzer-Regiment 1 and I/Schützen-Regiment 113, raced ahead and seized part of the Pulkovo Heights, just 7km south of Leningrad. Georgy Zhukov, who had just arrived in Leningrad to replace the incompetent Marshal Voroshilov, ordered immediate counterattacks to push the German armour back from the city. Baranov was ordered to use his last twenty-five tanks to spearhead the counterattack, which would be supported by several battalions of militia. Kapitan Spiller, still in command of the 1st Tank Battalion, had three KV-1s and five KV-2s, but the rest of the armour consisted of light tanks. The Soviet tanks attacked around 1500 hours, with Spiller’s KVs in front, lumbering out of the city and slowly climbing the heights south of the city. The German panzerjägers tried to break up the attack, but by this point they knew that their puny 3.7cm and 5cm antitank guns could do little to stop the KV heavy tanks.
KV tanks began crushing the Pak guns under their tracks and destroying their prime movers. German infantry, witnessing the defeat of their anti-tank troops, began to pull back. Several Pz.III tanks from Panzer-Regiment I tried to intervene but were knocked out by 76.2mm fire. Eventually, the counterattack culminated in a number of Soviet tanks being immobilized by damage, but 1.Panzer-Division was forced to pull back. Afterwards, Zhukov deftly shifted the few remaining KV tanks around the shrinking Leningrad perimeter, to contest German advances on the east and west sides of the city. Zhukov also used naval gunfire from the Baltic Sea fleet to support small-scale counterattacks, which impressed the Germans.