July 27, 2026 11:07 AM, EDT
An employee fixes the name on a Porsche 911 ST at the Zuffenhausen plant in Stuttgart. (Krisztian Bocsi/Bloomberg)
Key Takeaways:
Porsche agreed with labor officials to eliminate 5,000 jobs by 2035 through attrition, retirements and voluntary departures while avoiding compulsory layoffs.The pact comes as Volkswagen and Porsche face falling China demand, weaker electric-vehicle sales and pressure to cut costs and improve profitability.Porsche will extend protections for its German sites through 2035 and invest €2.1 billion in Zuffenhausen and Weissach operations.
Porsche AG agreed to eliminate 5,000 jobs by 2035 as part of a deal with labor officials that protects its main German sites and rules out compulsory redundancies.
The positions will be cut through a mixture of natural attrition, expanded partial-retirement programs and voluntary severance agreements, Porsche and its general works council said July 27. Employment and site protections at Zuffenhausen and Weissach will be extended through the end of 2035.
The agreement underscores the mounting pressure across Porsche parent Volkswagen AG, which last week warned that group revenue may fall as much as 3% this year as its China slump deepens.
VW has a number of underused factories, is saddled with costs roughly 30% higher than some competitors and needs to trim at least 10 billion euros ($11.4 billion) more in overhead expenses.
Once Volkswagen’s most reliable profit engine, Porsche has been hit particularly hard by the collapse in Chinese demand for German luxury cars and weaker-than-expected sales of electric models including the Taycan. The sports car maker is also cutting costs and reconsidering its product strategy after a rapid deterioration in profitability.
The latest pact follows an earlier plan to reduce Porsche’s workforce by about 3,900 by the end of the decade, including 2,000 temporary workers. The company, which employs roughly 40,000 people, has pledged to remove some management layers, simplify its organization and reduce research and development spending.
The new agreement includes 2.1 billion euros of investment at Zuffenhausen and Weissach as part of an effort to shore up its German operations.