Porsche is moving forward with a turnaround plan after a difficult 2025, with CEO Michael Leiters targeting higher margins, leaner operations and lower vehicle volumes. The strategy includes new combustion-powered models, expanded customization and a potential new halo hypercar.

Porsche’s Turnaround Strategy

Porsche’s sales remained steady or improved in some markets during 2025, but profits fell significantly. Leiters, who has been CEO for less than a year, is now facing the challenge of reshaping the German automaker’s business.

Leiters has introduced a turnaround strategy called the Sports Car Company ’35 plan. The approach emphasizes selling fewer vehicles while generating greater margins from each car, alongside efforts to make Porsche’s operations around Stuttgart leaner and more agile.

A New Combustion-Powered Macan

The Macan has been Porsche’s best-selling product, but the loss of its combustion-powered version affected the company’s bottom line. The electric Macan has performed well in Europe, while markets that have been slower to adopt electric vehicles have presented an opportunity cost for Porsche.

According to Automotive News, project M1 is being accelerated to recover sales and, more importantly, revenue. The compact combustion-powered crossover is expected to arrive soon, although it is not certain whether it will retain the Macan name.

The model will rely more heavily on Audi’s Premium Platform Combustion architecture, which should help reduce development costs. In the meantime, Porsche has given the electric Macan a series of updates aimed at attracting more customers.

New Porsche SUV and Electric 718 Models

Porsche is also preparing a flagship SUV positioned above the Cayenne. The model does not yet have a name but is expected to share a lot in common with the Audi Q9.

Meanwhile, Porsche is targeting a 2027 debut for the electric 718 Boxster and Cayman after multiple delays.

Higher Margins With Lower Volume

Although Porsche is not focused on pursuing volume, sales of the future M1 are expected to support the business. The company is also placing greater emphasis on its Sonderwunsch individualization program, which generates a significant amount of cash flow.

Leiters is also counting on models based around the 911 to produce higher margins without requiring Porsche to sell a record number of vehicles.

The strategy includes streamlining Porsche’s operations. Rather than simply reducing headcount, the plan focuses on maximizing roles across the organization. The changes are estimated to potentially deliver margin gains of 10 to 15%.

Porsche is also reducing its targets for the Chinese market and lowering its global sales goal to 250,000 vehicles per year. According to the report, the company will need at least 180,000 unit sales to break even.

Porsche Still Wants a New Hypercar

Despite its efforts to tighten spending, Porsche has not abandoned the idea of building a new halo hypercar. Automotive News reports that the project is internally known as S1 and has the blessing and approval of Leiters himself.

More than a decade has passed since the 918 Spyder premiered, and Porsche’s tradition of developing a hypercar roughly every decade has not yet been fulfilled in the 2020s.

The new model reportedly would not be developed entirely from scratch. Instead, it would be heavily based on the 911. It is not certain whether the hypercar would use a rear-mounted engine, but the approach would mark a departure from Porsche’s previous halo models.

Historically, Porsche hypercars used bespoke platforms developed specifically for individual models, including the Carrera GT from the 2000s and the 918 Spyder from the 2010s.

The planned hypercar is said to use a newly developed V8 engine, likely with some form of electrification, and would exceed $500,000 in price.

A Hypercar as Part of the Bigger Plan

A hypercar alone would not transform Porsche’s profits, but the project fits into the company’s broader strategy of generating more cash while delivering fewer vehicles.

As Porsche works through its turnaround, the company remains determined to pursue a new hypercar alongside its broader push for higher margins and a leaner business.