Porsche Cuts 9,000 Jobs in Pivot to Value Model

Porsche is shifting to a value-over-volume business model to recover profit margins that plummeted from 18 percent two years ago to 1.1 percent last year. The German sports car maker will reduce its workforce by 25 percent, cutting approximately 9,000 jobs by 2030, and will lower development costs by up to 20 percent.

To offset losses, the company will raise the average price of top-end models by 20 percent to roughly 330,000 euros. CEO Michael Leiters attributed the decline to intensified competition in China, U.S. tariffs, and a costly reversal of the company's electric vehicle strategy. Porsche is scaling back EV ambitions to focus on high-priced sports cars, including a new supercar platform and a combustion-engine Macan SUV slated for 2028.

The turnaround is critical for parent company Volkswagen, which owns 75 percent of the brand and recently reported a 6 billion euro write-down related to Porsche. The company stated it does not believe returning to previous volume levels at any cost would be realistic or beneficial for the brand.