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Why Porsche wants to cut around 1,900 jobs
The sports car and SUV manufacturer Porsche needs to save money - and plans to cut around 1,900 jobs. Affected are the main plant in Stuttgart-Zuffenhausen and the location with the development center in Weissach west of Stuttgart.
"The reductions affect all areas – from development, through production to administration," said Chief Human Resources Officer Andreas Haffner to the "Stuttgarter Zeitung" and the "Stuttgarter Nachrichten."
According to Haffner, the company, which is majority-owned by VW, is still comparatively well-positioned.
"But we have a variety of challenges to overcome." As examples, he named the delayed ramp-up of e-mobility and challenging geopolitical and economic conditions. Now it's about setting the course early in order to be successful in the future. "This also includes personnel costs," he said.
No dismissals for operational reasons until 2030
Management and the works council have therefore agreed on measures. According to the company, job cuts can only be carried out in a socially acceptable manner. Job security for the employees of Porsche AG is guaranteed until 2030. Dismissals for operational reasons are excluded until then - the company must therefore rely on voluntary measures.
Works council head Harald Buck said:
"There will be attractive early retirement offers."
In individual cases, the company will also offer termination agreements with severance pay. Additionally, Porsche plans to utilize workforce turnover and demographic changes by carefully examining replacements and new hires.
The cuts now announced come in addition to the savings already decided for temporary employees. Since last year, their production contracts have gradually expired. According to Haffner, 1,500 contracts were not renewed in 2024.
"Another 500 will be added in 2025."
Currently, the company employs 23,650 people. Savings are also planned in other areas: for instance, bonuses for employees will be capped. In the 2023 fiscal year, these were up to 9,690 euros.
"That will change. It will be significantly lower for the 2024 fiscal year," said Haffner.
But the management also intends to make a significant contribution to the savings volume, according to a spokeswoman. Whether jobs will also be cut at the Leipzig Porsche plant was initially unknown. The location is a subsidiary of Porsche AG and was not included in the current announcement.
Manager Shake-Up a Few Days Ago
It's turbulent times for the sports car manufacturer: At the beginning of the month, Porsche surprisingly announced that it wants to get rid of CFO Lutz Meschke and Head of Sales Detlev von Platen. The company did not name any reasons for the dismissal of the two managers.
However, the relationship between Meschke and Oliver Blume, who leads both Porsche and the VW Group, was considered tense. The deputy was rumored to have ambitions for the top position. Additionally, the stock price had significantly declined in the past. Furthermore, the Zuffenhausen-based company is currently struggling with weak business in China, among other issues. Successors for the two managers are not yet determined.
Combustion Engine Comeback
A few days later, the company announced a strategic shift: Porsche wants to focus more on combustion engines again. CEO Blume is willing to invest significantly in this: by 2025, the company expects an additional burden of up to 800 million euros - among other things, to develop new models with combustion and plug-in hybrid engines. The Zuffenhausen-based company also has to invest money in battery technology.
Officially, Porsche's ambitious e-car goal still stands: by 2030, more than 80 percent of sports cars and SUVs are to roll off the production line with a fully electric drive. However, it was recently stated that the goal depends on the demand and development of e-mobility in the world.
Already last year, preliminary figures showed that the company was under considerable pressure. This is because the demand for luxury cars is weakening. The shift back to combustion engines is likely to weigh further on Porsche's business figures this year. Last year, Porsche sold around 310,700 vehicles - three percent less than in 2023. In China, the world's most important car market, the decline was 28 percent. Recently, 27 percent of all Porsche cars delivered were fully electric or plug-in hybrid.
Content automatically translated.
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