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German Sports Carmaker Porsche to Cut 5,000 Jobs by 2035
🇸🇦 Saudi Arabia /Economy & Trade

German Sports Carmaker Porsche to Cut 5,000 Jobs by 2035

From Asharq Al-Awsat · () English

Summarized and contextualized by DistantNews.

At a glance

News From a news agency New plan
  • Porsche plans to cut 5,000 jobs by 2035 as part of a strategy to boost competitiveness.
  • The luxury carmaker cited falling sales in China, U.S. tariffs, and challenges with its electric vehicle transition.
  • The company will invest 2.1 billion euros in its Zuffenhausen and Weissach plants, guaranteeing employment there until 2035.

German luxury sports car manufacturer Porsche announced Monday it will reduce its workforce by 5,000 employees by 2035 as part of a strategic realignment aimed at enhancing competitiveness. The company, a subsidiary of the Volkswagen Group, has faced significant profit declines attributed to plummeting sales in China, where domestic electric vehicles now dominate the market.

Additional factors contributing to the downturn include U.S. tariffs and difficulties encountered during Porsche's transition to electric vehicles. The planned job cuts will be "socially responsible," primarily achieved through natural attrition, demographic changes, an expanded early retirement program, and voluntary severance agreements, according to AFP.

The shared objective is to strengthen the competitiveness of the sports car manufacturer and secure as many jobs as possible in the long term.

— PorscheStating the company's goal behind its strategic realignment and investments.

These new reductions, combined with job cuts announced last year, mean Porsche intends to decrease its current workforce of over 30,000 by a total of 8,900 people. Despite these measures, the company also revealed a "future package" involving an investment of 2.1 billion euros ($2.4 billion) by 2035 in its Zuffenhausen and Weissach plants near Stuttgart.

Workers at these two facilities will benefit from employment and site protection until 2035, following negotiations with the general works council and trade unions. "The shared objective is to strengthen the competitiveness of the sports car manufacturer and secure as many jobs as possible in the long term," the company stated. Porsche is also implementing other cost-saving measures, including deferring wage increases until 2035 and having senior executives forgo base salary raises in 2027 and 2028.

The new plan includes the 'socially responsible reduction of a further 5,000 jobs by 2035, largely through natural attrition, demographic effects, the expansion of the special partial retirement program and voluntary severance agreements,'

— PorscheDescribing the methods planned for workforce reduction.
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Originally published by Asharq Al-Awsat. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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