The restructuring measures adopted by Porsche are beginning to produce concrete results, so much so that on Wednesday the company declared to have seen the first effects. In this way, the luxury brand of the Volkswagen Group in difficulty manages to maintain unchanged profit forecasts, despite cost pressures in Germany and the drop in sales in China. The context remains complex: Porsche has to deal with the evolution of the market and with external factors that affect demand, from intense competition to trade restrictions related to tariffs.
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Porsche confirms profit estimates
The management turnaround also involves a change at the top: Michael Leiters, appointed CEO at the beginning of the year, has the task of leading one of the most complex restructuring programs in the German automotive sector. The work concerns the costly transition to electric vehicles, but also the growing competition from China and the difficulties related to customs duties. “The progress made so far gives me confidence in achieving our goals,” Leiters’ words quoted by Reuters. But the path is not yet over: “There is still a lot of work to do.”
The restructuring measures work
From an economic point of view, Porsche expects charges between 300 and 400 million euros related to the 20% staff cut by 2035, with a positive return expected from 2028, while a similar charge is also estimated in 2027. Meanwhile, Volkswagen recorded a 9.5% drop in operating profit in the second quarter, although some signs of stabilization are welcomed by analysts. At the same time, both car manufacturers are accelerating cuts: Volkswagen is considering a further 50,000 job reductions and even the possible closure of four German plants. Leiters reiterated a conservative approach in China, focusing more on German production and minimizing the impact of Chinese competition, arguing that it mainly concerns the mass market and not the premium segment in which Porsche operates.
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