Porsche, once known for its high profit margins, now stands at a crossroads of transformation and layoffs. Porsche CEO Oliver Blume sent an internal letter to all employees, confirming that the company is advancing its "Structural Adjustment Plan II." This means that, following the announcement in February to cut 1,900 positions and terminate around 2,000 temporary contracts, a new and larger round of layoffs is imminent.

The reason is clear: the global automotive industry is undergoing profound changes. The transition to electrification is not yet mature, the market for traditional fuel vehicles continues to shrink, and the high-end electric vehicle market is no longer a safe haven. In the first half of 2025, Porsche's sales in the Chinese market plummeted, with profit margins dropping to just 6.5% to 8.5%, far below the strategic target of 15% or even the previously promised 20%.

Blume bluntly stated, "Current performance does not meet our expectations. Porsche's ambitions go far beyond this."

In the letter, he specifically mentioned the changing market structure in China: Porsche's products are concentrated in the high-end segment, but the main battleground in China's new energy market has now shifted to mid-range and even entry-level products. High tariffs in the U.S. market and the weak dollar have also brought new financial pressures, while the diversity of electrification and global compliance costs have further driven up R&D and manufacturing expenses.

This round of layoffs may affect around 5,000 jobs. The company has stated it will not conduct "operational layoffs," but structural optimization through partial retirements, natural attrition, and compensation packages is highly likely. When traditional advantages cannot be quickly transferred to new technology tracks, even the strongest brands must make tough cuts.

Porsche's "high-margin myth" is quietly being rewritten!