February 14, 2025 – Porsche, facing a decline in electric vehicle sales, has announced plans to lay off 1,900 employees in Germany by 2029. The decision comes as the luxury carmaker revises its profit margin expectations downwards to between 10% and 12% for the current year, significantly below its long-term target of 20%.
In response to shifting market conditions, Porsche intends to introduce new gasoline and plug-in hybrid models. However, the company cautions that the development of these new vehicles and their associated battery technologies will incur an additional expense of 800 million euros in 2025.
According to Bloomberg, Porsche stated that the layoffs, affecting roughly 15% of its total workforce at its Zuffenhausen and Weissach factories in Germany, are necessitated by the “severe geopolitical and economic situation.” The company plans to implement the layoffs primarily through voluntary measures, such as early retirement and compensation packages.
Meanwhile, Porsche’s employment guarantee agreement remains in effect at least until 2030, and the company intends to tighten its hiring policies, indicating a potential slowdown in business expansion over the next few years.
Last year, Porsche’s global sales dropped by 3%, with a particularly notable decrease in the Chinese market. Once a significant profit driver for the brand, the Chinese market is now facing competition from emerging local brands.
Reports from Handelsblatt suggest that other Volkswagen Group brands may follow Porsche’s lead and refocus on gasoline and plug-in hybrid models. Various popular models, including the Golf, T-Roc, Tiguan, and Audi A3, are being considered for similar developments, although their launches are not expected until after 2030.
Volkswagen emphasized in a response to Bloomberg that the company still plans to phase out internal combustion engines by the early 2030s, stating they will “flexibly adjust strategies based on market changes.”
