Porsche has announced plans to eliminate an additional 5,000 jobs in Germany by 2035 as part of a broader restructuring effort aimed at improving profitability after a difficult 2025 marked by major EV strategy writedowns, weaker sales in China, and rising cost pressures in Germany.
The latest reductions bring Porsche’s total planned workforce cuts to 9,000 positions, meaning nearly one in five employees will ultimately leave the company. The automaker said the measures are part of its long-term “Future Package” initiative under the wider “Sportwagenschmiede 35” strategy.
Porsche Expands Workforce Reduction Plan
Porsche confirmed the decision after discussions between its executive board, the company’s general works council, the IG Metall trade union, and the Südwestmetall employers’ association.
The company said the additional 5,000 job reductions will be implemented without forced dismissals. Instead, Porsche plans to achieve the workforce reduction through natural employee turnover, demographic changes, an expanded partial retirement program, and voluntary severance agreements.
Compensation Changes Accompany Restructuring
Alongside the workforce reductions, Porsche announced several compensation adjustments.
A total of 3.5% of the current collectively agreed pay increase, along with future negotiated pay increases, will be deferred until 2035. Senior and top management will also waive an equivalent contribution from increases in basic remuneration during 2027 and 2028.
The company also said Christmas bonuses will be reduced from 100% to 60% of one month’s salary, while the maximum number of work-from-home days will decrease from 12 to eight per month.
Investment Planned for Key German Facilities
Despite the cost-cutting measures, Porsche announced investments totaling €2.1 billion ($2.4 billion) through 2035 for its main factory in Zuffenhausen and its Weissach research and development site.
The company said the investment is intended to ensure that two-door sports cars continue to be produced in Zuffenhausen over the long term, expand the capacity of the Sonderwunsch program, and keep development activities for all model lines concentrated in Weissach.
To help finance those investments, Porsche said it will implement significant reductions in personnel costs while increasing workplace flexibility and productivity.
Restructuring Supports 2026 Outlook
Porsche’s half-year financial results, released on July 29, showed that the restructuring measures have allowed the company to maintain its guidance for 2026 despite ongoing challenges.
Finance chief Jochen Breckner said the latest round of job reductions is expected to affect second-half financial results by between €300 million ($342 million) and €400 million ($456 million), with a similar financial impact anticipated next year.
“But we are convinced that this expenditure will soon pay off,” Breckner said.
Chief Executive Officer Michael Leiters said Porsche has worked intensively on its restructuring strategy since he assumed the role at the beginning of the year, while acknowledging that additional work remains.
“The Future Package is a key building block in making Porsche more competitive, more efficient and more resilient in the long term,” Leiters said. “I am therefore confident that we can achieve our goals. However, we still have a lot of work ahead of us to position Porsche robustly for the challenging future.”
First-Half Financial Performance
Porsche AG reported that operating profit increased 34% to €1.35 billion ($1.53 billion) during the first half of the year, supported in part by a shift toward higher-end vehicles with stronger profit margins.
Revenue declined 5% to €17.23 billion ($19.64 billion), while the company’s operating return on sales reached 7.8% during the first six months of the year. That result exceeded Porsche’s full-year target range of 5.5% to 7.5%.
The company said the restructuring measures remain a central part of its strategy as it works to strengthen long-term competitiveness while continuing to invest in its core production and development facilities.
