Porsche Faces 4,100 More Job Cuts Amid Volkswagen's Deep Crisis
Volkswagen's aggressive restructuring plan threatens to cut 4,100 additional jobs at Porsche, potentially reducing the sports car maker's workforce by 25%.
A deep crisis is shaking the Volkswagen Group, with shockwaves reaching its crown jewel, the luxury brand Porsche. According to a report published yesterday (Saturday) in the German economic newspaper Handelsblatt, Volkswagen's aggressive restructuring plan is set to cut an additional 4,100 jobs at the subsidiary.
This represents a dramatic escalation in cost-cutting measures. If implemented, this reported plan will add to July agreements laying off 5,000 workers by 2035, alongside a previous reduction of 4,000 jobs agreed upon even earlier.
The painful implication is that the sports car manufacturer could lose about a quarter (25%) of its entire workforce. This step stems from a broad organizational plan approved by the Volkswagen board in September, threatening approximately 50,000 jobs out of the group's more than 300,000 employees worldwide.
Although Volkswagen holds tight control over Porsche—owning 75% of the shares and 87% of voting rights—it can only recommend the move to Porsche's management rather than force it. Nonetheless, pressure on Porsche CEO Michael Leiters to present a swift recovery plan is steadily mounting.
Just yesterday, Volkswagen was forced to sharply slash its annual profit margin forecast to a mere 1% (down from 4%-5.5%), primarily due to write-downs at Porsche. The luxury automaker has recently been dealing with collapsing sales in the Chinese market and massive expenses involved in shifting its strategy toward electric vehicles (EV). Neither company has responded to the publication.
