The sports and off-road vehicle manufacturer Porsche wants to save a lot of costs in the next few years and focus more on vehicles with particularly high returns. This, among other things, is intended to make Porsche more profitable again. This emerges from a communication on the strategic realignment - called "Sportwagenschmiede '35" - which will be presented at an event in Weissach, Swabia, near Stuttgart.
“With our strategy, we are creating the conditions to make Porsche significantly more efficient, productive and profitable in three phases,” said CEO Michael Leiters, who has been in office since January, according to the statement. The current focus is primarily on reducing costs and making Porsche more financially robust.
Porsche reportedly wants to reduce its development costs for future model series by up to 20 percent. Personnel costs in production should be reduced by up to 30 percent in the medium term, and sales and distribution costs by 20 percent. The company is targeting a reduction of around ten percent in individual material costs. The number of model variants should also decrease.
Focus on core business and leaner organization
The main pillars of the strategy are the focus on the core business and streamlining the organization. Management positions will be reduced by 40 percent in the medium term, as Porsche announced. Ultimately, Porsche is aiming for a significantly lower break-even point, which should be achieved with fewer than 200,000 units. Recently, many parts of the group were designed to produce 350,000 cars, said Leiters - a consequence of the growth course in recent years. He did not provide any information on what number of units the break-even point was last.
What is clear, however, is that he wants to reduce the size of the company - this is considered difficult in the automotive industry because economies of scale usually come into play. At Porsche, the proportion of particularly expensive cars is now to be increased from around a third to almost half. This should raise the average sales price of the most expensive 10,000 cars sold from 270,000 euros to 330,000 euros by 2030. Among other things, a larger and more expensive SUV than the Cayenne is planned, and a two-door super sports car based on the 911 is also likely to be added.
Profitability should increase again
With the strategy, the Swabians also want to increase business figures again. “Sales growth should exceed sales growth, and earnings growth should exceed sales growth,” the statement said. In the medium term, an operating profit of 10 to 15 euros should remain for every 100 euros in sales. In the first half of the year it was 7.80 euros. In absolute terms, Porsche is aiming for sales of between 41 and 45 billion euros in a few years (2025: 36.3 billion). The upper end of the goals also depends on a better economic, geopolitical and regulatory environment or on further value creation initiatives.
Slump in profits last year
The Stuttgart-based company has recently had to struggle - among other things, with falling sales figures, especially in China, lower demand for electric models and US tariffs. In addition, there were the billions in costs for the combustion engine extension, which have largely eaten up the group's profits in 2025. Earnings after taxes fell by 91.4 percent to 310 million euros compared to the previous year. The result stabilized in the first half of the year. The crisis at Porsche recently also had a severe impact on the business figures of its parent company, Volkswagen.
In the summer, management and employees agreed on a savings program that plans to cut 5,000 more jobs in the Stuttgart region by 2035. In return, operational dismissals were ruled out until the end of 2035. There had already been reduction programs at Porsche - including at the Leipzig plant and at subsidiaries. “Overall, the workforce in the direct and indirect areas will be reduced by 25 percent in the medium term - with a strategic goal of 30 percent,” it said.
