Porsche to cut 5,000 jobs by 2035, Audi lowers 2026 sales forecast

Porsche has finalized plans to cut an additional 5,000 jobs by 2035, to be implemented through socially acceptable measures. At Audi, the possibility of plant closures is under discussion.

Published: July 28, 2026, 11:24 UTC

At Porsche, 5,000 jobs are to be eliminated through partial retirement and severance agreements. Photo: Marijan Murat/dpa

afp/taz — The difficulties at Volkswagen are extending to its premium subsidiaries. Sports car manufacturer Porsche announced an additional 5,000 job cuts on Monday, while Audi lowered its sales forecast for the current year. Both VW subsidiaries are suffering from a collapsing China business and the heavy burden of tariffs imposed by US President Donald Trump, mirroring challenges faced by the group's core brand.

Porsche: Strategic Shift and Job Reductions

At Porsche, the strategic pivot away from combustion engines is proving costly. The company originally planned a complete transition to electric vehicles in the coming years, but approximately two years ago, the luxury carmaker decided to extend its reliance on combustion engines.

Porsche has now announced a "socially acceptable" job reduction to be completed by 2035. Sales in the first half of the year fell sharply—by around 16 percent to approximately 122,000 vehicles. In China, sales collapsed by a third, and in North America by 13 percent. In its home market of Germany, the company delivered just under 15,000 cars, six percent fewer than in the same period last year.

The "future package," negotiated with the General Works Council and IG Metall, is intended to "significantly" reduce personnel costs, according to Porsche. In return, the board has pledged investments of €2.1 billion in the Zuffenhausen and Weissach sites near Stuttgart. The stated common goal is "to strengthen the competitiveness of the sports car manufacturer and thereby secure as many jobs as possible in the long term."

Partial Retirement and Severance Agreements

According to the company, the 5,000 jobs will be eliminated through:

• Natural fluctuation
• Partial retirement
• Severance agreements

At the same time, Porsche has guaranteed the preservation of its sites and ruled out operational redundancies until 2035. In 2025, Porsche had already announced 3,900 job cuts. Prior to that, the company employed just over 42,000 people.

Reactions to the Package

Porsche CEO Michael Leiters described the package positively: "The future package is good for Porsche. It gives us the opportunity to strategically realign our company and invest in our competitiveness." He added that security for employees exists only "if we achieve our goals and are economically successful."

Ibrahim Aslan, Chairman of the General Works Council, called it a "hard-fought" package. "We were able to convince the employer side that an investment in the Porsche company at the Zuffenhausen and Weissach sites is an opportunity and thus secures employment significantly for another five years." He noted that the resulting burdens would be distributed across all shoulders.

Cem Ince, social policy spokesperson for the Left Party faction in the Bundestag, criticized the federal government's pension plans in light of these developments: "Partial retirement models have been a central instrument for making job cuts socially acceptable for years. An end to the deduction-free pension after 45 contribution years would bury this instrument," which he said would have catastrophic consequences for employees, companies, and regions.

Audi: Sharper Savings Plan and Lowered Forecast

The Ingolstadt-based VW subsidiary Audi lowered its sales forecast for 2026 by €5 billion on Monday, now projecting €58 to €63 billion. "Geopolitical uncertainties, US tariffs, and intense competition—especially in China—shaped business development," the company explained.

In the first half of the year, Audi recorded total sales of just over €29 billion—10.4 percent less than in the same period last year.