Volkswagen Proposes 4,100 More Job Cuts at Porsche

Volkswagen, the parent company of luxury sports car brand Porsche, has proposed cutting around 4,100 additional jobs at the automaker. The startling development was revealed in an exclusive report by Germany’s influential business daily Handelsblatt.

Citing internal documents from Volkswagen’s management board, the report said the new proposal is aimed at addressing a shortfall of around €700 million (approximately $803.8 million) in annual operating costs and implementing a broader restructuring plan. If approved, the cuts would come on top of Porsche’s previously announced workforce reduction program.

Major Blow to Porsche’s Overall Workforce

In July, Porsche management and employee representatives reached an agreement to cut an additional 5,000 jobs on top of 4,000 previously announced reductions. Under the plan, one in every five employees at the maker of the iconic ‘911’ model could be affected by job cuts by 2035.

If another 4,100 jobs are eliminated, the company’s workforce would face a major disruption. However, Volkswagen can only recommend the measure, and Porsche’s management is not legally obligated to implement it directly.

China Market Slump and Shift in EV Strategy

Volkswagen has reduced its profit target for the current year from 4.0–5.5 percent to a maximum of 1 percent. The parent group is facing substantial financial losses largely due to a writedown in the value of its stake in Porsche.

Porsche has been under increasing pressure as vehicle sales have fallen sharply in global markets, particularly in China. The company is also struggling to reassess its strategy after spending heavily on electric vehicle (EV) development. Porsche CEO Michael Leiters is facing the challenge of navigating the company through this difficult period.

Against this backdrop, Volkswagen is considering such drastic measures in an effort to protect Porsche from further financial losses and restore its competitiveness.

//DBTech/BMT/OR//