Porsche said its restructuring program has begun producing financial benefits, allowing the luxury automaker to maintain its full-year profit guidance despite declining sales in China, elevated German manufacturing costs and continued trade pressures.
The company’s operating return on sales improved to 7.8% during the first half of 2026, compared with a record-low 1.1% for full-year 2025. The first-half margin also exceeded Porsche’s full-year target range of 5.5% to 7.5%.
Porsche appointed Michael Leiters as CEO at the beginning of 2026 to oversee one of the most substantial restructuring programs underway in Germany’s automotive industry.
The company plans to eliminate approximately 20% of its workforce by 2035 and expects to record between €300 million and €400 million in related charges during the second half of 2026. A similar charge is anticipated in 2027, with the cost-cutting program expected to begin producing positive financial effects in 2028.
The restructuring is focused on tighter cost controls, increased efficiency at German factories and adapting Porsche’s product strategy to slower electric vehicle adoption, increased competition and changing global demand.
Porsche continues to face significant weakness in China, where its annual vehicle deliveries have fallen by more than half since reaching their peak in 2021.
Leiters said the company is taking a more conservative approach to China while emphasizing German production and Porsche’s position in the premium luxury market. He also argued that growing Chinese competition in Europe presents a greater challenge to mass-market automakers than to Porsche.
Porsche shares increased as much as 4.8% following the results before giving back most of those gains. The reaction reflected some investor optimism that the automaker’s operating performance may be stabilizing following an extended period of margin pressure.
KEY QUOTES:
“The progress we have made so far gives me confidence that we will achieve our goals. But there is still a great deal of work ahead of us.”
“Porsche is different from many of our peers. We operate in a premium luxury segment and are less dependent on China.”
Michael Leiters, CEO of Porsche
