Porsche to cut 5,000 jobs by 2035 under labor pact

German luxury automaker Porsche will cut an additional 5,000 jobs by 2035 as part of a major restructuring agreement with labor representatives, the company announced on Monday, July 27, 2026. The deal, which rules out compulsory layoffs, extends employment and site protections for its key German factories in Zuffenhausen and Weissach through the end of 2035 and includes a 2.1 billion euro investment pledge for those locations.

The new cuts, to be achieved through natural attrition, expanded partial retirement programs, and voluntary severance agreements, follow a previously announced plan to reduce the workforce by approximately 4,400 positions. This brings the total planned reduction to roughly 9,400 jobs by 2035. The company, which employs about 40,000 people, described the approach as socially responsible.

The agreement underscores the severe financial pressures facing Porsche and its parent company, Volkswagen. Porsche's operating margin has collapsed to approximately 1 percent, a dramatic fall for a brand that was once Volkswagen's most reliable profit engine. The company has been hit particularly hard by a steep decline in demand for German luxury cars in China, where...