On the Dash:
- Porsche will cut 5,000 more jobs by 2035 under a new labor agreement with unions
- Company will invest 2.1 billion euros in Zuffenhausen and Weissach sites through 2035
- Deal rules out compulsory layoffs through 2035 in exchange for employee pay concessions
According to the German luxury automaker, Porsche AG will cut 5,000 additional jobs by 2035 under an agreement between its Executive Board and General Works Council. The company negotiated the deal together with IG Metall and the Südwestmetall employers’ association.
Porsche calls the agreement its Future Package, and describes it as the basis for a strategic realignment under its “Sportwagenschmiede 35” strategy. The company will invest a cumulative 2.1 billion euros in its Zuffenhausen and Weissach sites by 2035. That’s roughly $2.4 billion at current exchange rates.
Employment and site protection will run through the end of 2035, ruling out compulsory redundancies during that period. The workforce reduction will happen mainly through natural attrition, demographic effects, an expanded partial retirement program and voluntary severance agreements. The new cuts follow an earlier package of 3,900 job reductions the automaker agreed to in February 2025.
“The Future Package is good for Porsche. It gives us the opportunity to strategically realign our company and invest in our competitiveness,” said Dr. Michael Leiters, Porsche AG CEO, in a statement.
Employees will contribute to financing the investment by making several concessions. Specifically, 3.5% of current and future collectively agreed pay increases will be deferred until 2035. Senior and top management will also forego an equivalent base pay increase in 2027 and 2028. Additionally, the company’s voluntary share of Christmas bonuses will decrease from 45% to 5% by 2035. Moreover, mobile work will be limited to eight days per month instead of 12.
In return, the company will pay workers a one-time transformation bonus. Employees will receive 1,500 euros in August 2026, with IG Metall members getting an additional 411 euros.
The restructuring follows a sharp decline in Porsche’s profitability tied to weakening demand in China and rising costs from its electric vehicle transition.
Porsche is a subsidiary of Volkswagen AG, Europe’s largest automaker, and the Future Package lands amid a much larger restructuring push across the group. Volkswagen CEO Oliver Blume is pushing to double the group’s planned job cuts to as many as 100,000 positions and has floated closing four German plants, including one belonging to Audi. Volkswagen’s works council and IG Metall have said they will resist the plan if it moves forward.
