Luxury car brand Porsche has initiated layoffs in the Chinese region, according to multiple industry insiders on December 17. The layoffs affect both regular and outsourced employees, with compensations being executed according to the N+6 standard.
Porsche China denied the layoffs and related information to Jiemian News on December 17 but acknowledged that internal organizational restructuring is underway.
Porsche China stated that they are enhancing the efficiency and optimizing costs of various departments and projects, with related measures affecting both direct and indirect labor costs based on actual circumstances.
However, internal Porsche employees informed First Financial that the layoffs within the company are real. Permanent employees are facing a 10% reduction, while outsourced staff are experiencing a 30% cut. Additionally, Porsche plans to reduce the number of its own stores by the end of 2026, controlling the number of dealerships to around 100.
During Porsche’s third-quarter investor conference call at the end of October, Porsche’s Chief Financial Officer Lutz Meschke revealed for the first time that Porsche will “significantly reduce its dealership network in China”.
Official data shows that from January to September 2024, Porsche’s global cumulative deliveries totaled 226,000 vehicles, a 7% decline year-on-year. The most significant decline was observed in the Chinese market.
Porsche delivered approximately 43,300 vehicles in the Chinese market in 2024, representing a 29% year-on-year decrease; domestic deliveries in Germany reached 26,800 vehicles, an 8% increase year-on-year; North America saw around 61,500 vehicles delivered, a 5% decrease year-on-year; and in the European market (excluding Germany), deliveries amounted to 52,500 vehicles, a 1% increase year-on-year.
This marks the second consecutive year of declining sales for Porsche in the Chinese market. Last year, China was the only market globally where Porsche experienced a decline in 2023, with a 15% year-on-year decrease. Meanwhile, in 2023, North America surpassed China to become Porsche’s largest individual market.