As parent Volkswagen and its businesses restructure in response to low demand and fierce competition, German luxury car manufacturer Porsche plans to eliminate almost one in five jobs by 2035, totalling 9,000 jobs.
Following months of negotiations, Porsche management and labour leaders reached an agreement on Monday that calls for an additional 5,000 job cuts that avoid mandatory layoffs through voluntary programs and natural attrition, according to a report by Reuters.
These actions come after a first package of 3,900 job losses that were agreed upon in February 2025 and an additional 500 layoffs that CEO Michael Leiters announced this year in connection with the closure of subsidiaries.
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By the end of 2024, Porsche employed about 42,600 people.
Leiters was given the responsibility of restructuring the company when he took over as CEO at the beginning of the year, following the collapse of sales in Porsche's formerly extremely profitable China market and the stalling of its EV effort.
According to Daniel Schwarz, an automobile analyst at investment bank Metzler, the employment layoffs approximately match the drop in sales volume. "They are unavoidable to reduce costs, because a return to strong growth in China is not expected," he was reported as saying by Reuters.
As they navigate the transition to electric vehicles in a competition with Chinese rivals while absorbing the impact of hefty tariffs, other German automakers, such as Mercedes-Benz and BMW, are also slashing expenses.
Porsche and the works council said in a statement that the deal includes investments of €2.1 billion ($2.39 billion) in the company's main factory in Stuttgart-Zuffenhausen and its R&D center in Weissach, as well as guarantees to keep sites open for an additional five years, until the end of 2035.
The announcement came after Porsche's supervisory board met last Wednesday and approved the extra layoffs.
Oliver Blume, Leiters' predecessor, is still the CEO of Volkswagen after ending a dual leadership position that many investors found objectionable.
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To stay competitive as more Chinese companies enter Europe, Blume is now advocating for a doubling of employment cutbacks throughout the Volkswagen group to 100,000.
Additionally, he has issued a warning that four of the group's factories—including one for the high-end brand Audi—may close beyond 2030.
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