The bad news keeps coming for Volkswagen Group. Europe’s largest automaker announced one-off charges of $11.5 billion, mostly at its Porsche luxury unit.
A profit warning was also issued, with Volkswagen Group expecting a profit margin of 1 percent at the most in 2026—a significant drop from the previous guidance of 4 percent to 5.5 percent. Now, it looks like Porsche may have to take additional painful measures to restructure its business.
The 4,100 Job Cuts Would Be in Addition to the 9,000 Layoffs Announced Earlier
Porsche
German business daily Handelsblatt reported (via Reuters) that Volkswagen Group’s turnaround plan foresees more than 4,000 further job cuts at Porsche.
According to files documenting a recent agreement by VW’s supervisory board to implement the largest restructuring yet at the company, a reduction of “about 4,100 employees” is being considered for Porsche. The layoffs would address an overhead shortfall of some $804 million, the newspaper wrote, adding that the cuts would be “in addition to existing agreements.”
In July, Porsche management and labor representatives agreed to an additional 5,000 job cuts on top of 4,000 announced earlier, meaning that about one in five Porsche employees would have to go by 2035.
If the additional 4,100 layoffs are approved—VW Group can only recommend, but not enforce, such measures at Porsche—the total number of job cuts would sit at 13,100, meaning that almost one in three Porsche employees would lose their jobs by 2035.
Porsche Has a Lot of Work to Do to Get Back on Track
That is an enormous amount of job cuts, but then again, Porsche is deep trouble at the moment. The company is under pressure to deliver a comeback strategy after its China sales collapsed, its bottom line has been hard hit by U.S. tariffs, and the reversal of its EV strategy has cost it billions.
Porsche posted a profit margin of just 1.1 percent in 2025, compared to almost 9 percent in 2024. As a result, the company’s Strategy 2035 turnaround plan presented by CEO Michael Leiters in June is built around the idea that Porsche needs to chase profit, not sales volume.
Porsche will double down on sports cars, driving engagement, performance and exclusivity while at the same time trimming the many variants of existing models and staying committed to combustion, hybrid, and electric powertrains all at once.
As for the workforce reductions and cost-cutting measures, the recommendation from parent company VW Group to cut more jobs is a sign that we haven’t seen the full scope of what’s in store for Porsche employees and sites.
