Porsche to cut 5,000 more jobs in second restructuring round, extends site guarantees to 2035

Second restructuring round

Porsche will cut another 5,000 jobs by 2035 under a second package of restructuring measures agreed between management and labour representatives, the company and works council said in a joint statement on Monday. The cuts follow a first package announced in February 2025 that eliminated around 1,900 permanent positions and allowed 2,000 temporary contracts to expire, plus another 500 jobs at subsidiaries. In total, roughly 8,900 employees will leave the Stuttgart-based sports car maker in the coming years. The reductions will be carried out through natural attrition, demographic effects, partial retirement and voluntary severance agreements, with no compulsory redundancies.

What the package includes

The agreement extends plant location guarantees by five years until the end of 2035 and commits €2.1 billion ($2.39 billion) in investments to the Zuffenhausen main plant and the Weissach development centre. To finance the programme, collectively agreed wage increases will be partially withheld until 2035, the Christmas bonus will be reduced, and the employee bonus will be more closely tied to company performance. Large parts of management will forgo base salary increases in 2027 and 2028. Home office will be limited to eight days per month, down from twelve, and rest breaks in the factory are to be adjusted.

This gives us the opportunity to strategically realign our company and invest in our competitiveness.

Works council head Ibrahim Aslan highlighted the unexpectedly long job security commitment.

Nobody would have believed beforehand that we would conclude a future package until the end of 2035.

Crisis at Porsche

Porsche, once the most profitable German carmaker with margins around 15%, has been hit by collapsing sales in China, elevated US tariffs and weak demand for electric vehicles. Sales peaked at around 320,000 vehicles in 2023 but fell to 279,400 in 2025, and the company forecasts only 250,000 deliveries this year. Operating profit plunged from €5.6 billion in 2024 to €413 million in 2025, while net profit dropped 91% to €310 million. In the first half of 2026, Porsche earned €1.35 billion, a margin of 7.8%. The workforce in the Stuttgart region shrank from about 22,200 at the end of 2024 to roughly 20,600 a year later, and worldwide employment stood at nearly 41,800 at the end of 2025.

Audi also cuts costs

The Porsche announcement came as fellow Volkswagen subsidiary Audi lowered its full-year forecast. Audi now expects 2026 revenue of €58 billion to €63 billion, €5 billion less than previously projected, and an operating margin of 5% to 7%, down one percentage point. In the first half, Audi's margin was just 3.8%. Finance chief Jürgen Rittersberger said existing savings measures were showing effect but were not sufficient, and the company needed to become more competitive and efficient.

Union concessions and bonuses

The deal was negotiated with the IG Metall union and the Südwestmetall employers' association. To secure employee consent, Porsche offered a one-time "transformation premium" of €1,500 per worker. Union members receive an additional €411 one-off payment and a new "IG Metall bonus" of an extra day off and a €200 voucher per year. The Porsche family, led by Wolfgang and Oliver Porsche, had initially insisted on no commitments beyond 2030, but ultimately agreed to the 2035 horizon.