Porsche unveils 2035 strategy with up to 30% job cuts and a return to combustion cars
In short
Porsche on 7 October announced its "Sportwagenschmiede'35" strategy aimed at 2035, under which it plans to cut up to 30% of jobs, including 40% of management positions, and return to combustion-engine cars, IT Home and QbitAI reported. The company aims to break even at sales of fewer than 200,000 vehicles, cut model derivatives by about 20% and focus on the higher-margin D and E segments. The plan comes after Porsche's operating margin fell to 1.1% in 2025 and its China deliveries dropped 32% in the first half of 2026.
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Porsche on 7 October published a strategy named "Sportwagenschmiede'35", aimed at 2035, IT Home reported. Under the plan the company will cut up to 30% of jobs, offer more mid-size and large sports cars and return to combustion-engine cars to improve profitability, according to IT Home. QbitAI called it the largest restructuring plan in Porsche's history and said new chief executive Michael Leiters described cutting costs and strengthening financial robustness as the top priority. The company aims to break even at sales of fewer than 200,000 vehicles. [ 1 , 2 , 3 ]
Porsche plans to cut the number of model derivatives by about 20% and shift toward the higher-margin D and E segments, whose share of the line-up it aims to raise by about 45%, IT Home reported. It is developing a mid-engine supercar platform for a new top series positioned above the 911. Electric 718 Boxster and Cayman models are expected to support sales in 2028, their first full production year, and a new B-segment SUV with combustion and plug-in hybrid drives will be sold alongside the electric Macan. QbitAI and Huxiu reported that average prices of top models are to rise by about 20%. [ 1 , 2 , 3 ]
In the medium term Porsche plans to cut management positions by 40% and staff in direct and indirect functions by 25%, with a strategic target of 30%. It aims to cut development costs for future model lines by up to 20%, production labour costs by up to 30% and sales and distribution costs by 20%. Porsche Engineering and Porsche Digital will merge into Porsche Technology. QbitAI noted that the percentages use different bases and cannot be added together to calculate job cuts. [ 1 , 2 ]
In July, management and employee representatives agreed to cut a further 5,000 jobs, bringing the agreed total to about 9,000 with 4,000 cuts set earlier. IT Home said this equals about one-fifth of Porsche's workforce by 2035. According to QbitAI, the cuts are to come through natural attrition, early retirement and voluntary severance, job security for core staff in Germany has been extended to the end of 2035, and Porsche will invest 2.1 billion euros in the Zuffenhausen plant and the Weissach R&D centre by 2035. [ 1 , 2 ]
IT Home reported a medium-term group revenue target of 41 billion to 45 billion euros and long-term targets of a 15% return on sales and a 12% net cash flow margin in the automotive business; Huxiu gave a medium-term return-on-sales target of 10% to 15%. Return on sales was 7.8% in the first half of 2026. QbitAI and Huxiu reported 2025 operating profit of 413 million euros and a margin of 1.1%; QbitAI put the 2023 operating margin at 18%. IT Home said parent Volkswagen Group cut its full-year margin forecast from 4.0%-5.5% to at most 1%. [ 1 , 2 , 3 ]
QbitAI linked Porsche's charges to falling sales, especially in China, where deliveries fell from 95,671 in 2021 to 41,938 in 2025. QbitAI and Huxiu said China deliveries fell a further 32% in the first half of 2026. [ 2 , 3 ]
Why it matters
The plan cuts staff, costs and model variants at Porsche, and QbitAI said the company's earlier electrification strategy had taken a sharp turn, leaving more room for combustion cars. QbitAI and Huxiu tied the restructuring to falling profits and sales, especially in China, where QbitAI said Chinese new-energy brands now compete with traditional luxury brands and Huxiu said domestic brands hold more than half of retail sales above 400,000 yuan.
Key facts
- Porsche announced the "Sportwagenschmiede'35" strategy, aimed at 2035. [ 1 , 2 , 3 ]
- The plan cuts up to 30% of jobs, including 40% of management positions. [ 1 , 2 ]
- Porsche aims to break even at sales of fewer than 200,000 vehicles. [ 1 , 2 , 3 ]
- The number of model derivatives is to be cut by about 20%, with a focus on higher-margin D and E segments. [ 1 , 3 ]
- Porsche Engineering and Porsche Digital will merge into Porsche Technology. [ 1 , 2 ]
- In July, management and employee representatives agreed job cuts totalling about 9,000. [ 1 , 2 ]
- Porsche's 2025 operating profit was 413 million euros, a margin of 1.1%. [ 2 , 3 ]
- Porsche's deliveries in China fell 32% in the first half of 2026. [ 2 , 3 ]
Confirmed by several sources
- Porsche's new strategy is named "Sportwagenschmiede'35" and is aimed at 2035. [ 1 , 2 , 3 ]
- Porsche plans to cut up to 30% of jobs. [ 1 , 2 ]
- Management positions are to be cut by 40%. [ 1 , 2 , 3 ]
- Porsche aims to break even at sales of fewer than 200,000 vehicles. [ 1 , 2 , 3 ]
- Model derivatives are to be cut by about 20%. [ 1 , 3 ]
- Porsche is developing a mid-engine car positioned above the 911. [ 1 , 3 ]
- Porsche Engineering and Porsche Digital will merge into Porsche Technology. [ 1 , 2 ]
- Average prices of top models are to rise by about 20%. [ 2 , 3 ]
- Return on sales was 7.8% in the first half of 2026. [ 1 , 3 ]
- Operating profit in 2025 was 413 million euros, with a margin of 1.1%. [ 2 , 3 ]
- China deliveries fell 32% in the first half of 2026. [ 2 , 3 ]
Still unclear
- Date of the announcement IT Home, publishing on 7 October 2026, said the strategy was released that day, while Huxiu dated it 7 October 2025.
- How the 9,000 job cuts relate to the new strategy IT Home and QbitAI said the 9,000 cuts were agreed in July, while Huxiu presented them as part of the new strategy; QbitAI said the percentage targets use different bases and cannot be added to calculate job cuts.
- Medium-term return-on-sales target Only Huxiu gave a medium-term target of 10% to 15%; IT Home gave only the long-term 15% target and a revenue target.
- Global delivery decline in the first half of 2026 QbitAI put it at about 16%, Huxiu at 16.5%.
- Whether an electric 911 has been dropped Only Huxiu reported that a fully electric 911 had been abandoned.