Porsche to Cut 5,000 More Jobs by 2035 as Part of Major Restructuring Plan
- Team Autopunditz
- Jul 28
- 4 min read
German sports car manufacturer Porsche has announced plans to reduce a further 5,000 positions by 2035 as it attempts to lower costs, improve productivity and realign its business amid declining global sales and mounting pressure in the electric vehicle market.
The latest workforce reduction forms part of Porsche’s newly agreed “Future Package”, developed jointly by the company’s executive board and general works council.
The plan covers Porsche’s main production facility at Stuttgart-Zuffenhausen and its research and development centre in Weissach. While the restructuring involves substantial workforce reductions and changes to employee benefits, Porsche has ruled out compulsory redundancies at these locations until the end of 2035.
Another 5,000 Positions to Be Reduced
Porsche says that the latest reduction of approximately 5,000 jobs will be carried out in a “socially responsible” manner.
The company plans to achieve this primarily through:
Natural employee attrition
Demographic changes and retirements
Expanded partial-retirement programmes
Voluntary severance agreements
The latest announcement comes in addition to around 3,900 job reductions planned under an earlier restructuring package announced in 2025.
Porsche also announced the closure of three subsidiaries—Cellforce Group, Porsche eBike Performance and software company Cetitec—during 2026, affecting more than 500 additional positions.
Combined, Porsche could eliminate close to 9,000 positions by 2035, representing roughly one-fifth of the company’s workforce based on its staffing level at the end of 2024. Porsche employed approximately 42,600 people at that time.
Porsche Commits €2.1 Billion to German Operations
Alongside the job cuts, Porsche has committed to investing a cumulative €2.1 billion in its Zuffenhausen and Weissach facilities through 2035.
The investment is intended to secure the long-term future of both locations, improve manufacturing efficiency and support the development of future Porsche models.
Porsche says the investment will help ensure that two-door sports cars continue to be manufactured at Zuffenhausen. It also plans to expand its highly profitable Sonderwunsch vehicle-personalisation programme.
Weissach, meanwhile, will continue to serve as Porsche’s central development location for all model lines.
Employees to Contribute Through Reduced Benefits
The restructuring package extends beyond workforce reductions. Porsche employees and senior management will also contribute through changes to compensation, bonuses and workplace policies.
Under the agreement, 3.5% of collectively negotiated salary increases will be deferred until 2035 for employees covered by Porsche’s specific pay framework.
Senior and top-level management will make a corresponding contribution by foregoing part of their basic salary increases during 2027 and 2028.
Other changes include:
Reduction in the voluntary component of Christmas bonuses
Greater linkage of special payments to company profitability
Mobile working reduced from 12 days to a maximum of eight days per month
Changes to break arrangements and manufacturing cycle times
Measures aimed at increasing flexibility and productivity
Porsche will provide employees with a one-time transformation bonus of €1,500 in August 2026. Eligible IG Metall members will receive an additional amount, taking their total payment to €1,911.
Why Is Porsche Restructuring?
Porsche is confronting one of the most challenging periods in its recent history.
The company delivered 1,22,306 vehicles globally during the first half of 2026, representing a decline of 16% compared with 1,46,391 units during the corresponding period of 2025.
The most significant pressure came from China, historically one of Porsche’s most profitable markets. Deliveries in China declined by 32% to 14,501 units during H1 2026.
Increasing competition from domestic Chinese premium and electric vehicle manufacturers has made it more difficult for established German brands to maintain their earlier market position.
Porsche’s deliveries also fell by:
13% in North America
14% in Europe excluding Germany
6% in Germany
18% across overseas and emerging markets
Only the Porsche 911 registered strong growth, with deliveries increasing by 19% during the first half of 2026.
Porsche’s EV Strategy Faces Challenges
The company is also reassessing its electric vehicle strategy after demand for premium EVs grew more slowly than initially anticipated.
Porsche had aggressively invested in electrification, including the Taycan and electric Macan. However, Taycan deliveries declined by 25% during the first six months of 2026, while total Macan deliveries fell by 22%.
Of the 35,315 Macans delivered during the period, 15,620 were electric versions and 19,695 were combustion-engined models.
Porsche has acknowledged that the transition towards electric mobility is progressing more slowly than expected. The company is consequently aligning its portfolio more closely with actual customer demand instead of pursuing an exclusively EV-led product strategy.
This is likely to mean a longer life for combustion-engine and plug-in hybrid models, particularly in markets where charging infrastructure and EV adoption remain limited.
Greater Focus on Core Porsche Products
Under CEO Michael Leiters, Porsche is expected to place greater emphasis on its most profitable and brand-defining products.
The decision to close businesses related to battery manufacturing, electric bicycles and software reflects the company’s intention to concentrate resources on its core automotive operations.
Porsche’s restructuring is expected to prioritise:
High-margin sports cars
Premium SUVs
Limited-production and personalised models
More disciplined product development
Reduced organisational complexity
Improved manufacturing productivity
Further details of Porsche’s broader “Sportwagenschmiede 35” strategy are scheduled to be presented during the company’s Capital Markets Day in October 2026.
Part of a Wider German Automotive Industry Reset
Porsche’s decision is not taking place in isolation.
German automotive manufacturers are facing considerable pressure from rising development costs, higher tariffs, slower economic growth and strong competition from Chinese electric vehicle companies.
Porsche’s parent company, the Volkswagen Group, is pursuing its own extensive cost-reduction programme. Mercedes-Benz and BMW have also introduced efficiency measures as the European automotive industry attempts to manage the expensive transition towards electrification.
The Porsche restructuring highlights how even highly profitable luxury manufacturers are being forced to reconsider their cost structures, model portfolios and electrification timelines.
Auto Punditz Take
Porsche’s decision to reduce another 5,000 positions is not merely a conventional cost-cutting exercise. It represents a deeper correction following weaker demand in China, slower premium-EV adoption and rising operational costs.
At the same time, the €2.1 billion investment commitment and protection of the Zuffenhausen and Weissach facilities indicate that Porsche is not retreating from product development or manufacturing in Germany.
Instead, the company appears to be attempting to create a smaller, more flexible and more profitable organisation centred around its strongest products.
The continuing success of the Porsche 911 also offers an important signal. Even as the industry moves towards electrification, distinctive products with strong heritage, pricing power and customer loyalty remain crucial.
Porsche’s biggest challenge will be balancing that heritage with future technology—without repeating the costly strategic assumptions that contributed to its current restructuring.
