Porsche's supervisory board approved a "future package" on July 22 that simultaneously secures jobs through 2035 and eliminates roughly 5,000 positions, according to media reports citing company sources. The deal extends the automaker's current job security agreement, which covers 23,000 employees at its Zuffenhausen and Weissach sites through mid-2030, by five years while doubling down on CEO Michael Leiters' restructuring program.

This is how German works councils operate. Employee bodies with legal veto power over layoffs negotiate these trade-offs routinely. General works council chairman Ibrahim Aslan had demanded job security "at least until 2035" in exchange for accepting workforce reductions. Management gets flexibility to cut now; labor gets a commitment that production stays in Germany for another decade.

The latest round brings Porsche's total planned cuts to roughly 9,000 jobs by 2035. The company agreed to eliminate 3,900 positions in June, had already announced 1,900 cuts in February, and shuttered three subsidiaries in May, eliminating another 500 jobs. A company spokesperson confirmed the supervisory board's approval but declined to specify the new round's scope.

Porsche's operating margin collapsed to roughly 1% in 2025 as China sales fell 26%. The company expects €800 million to €900 million in restructuring costs this year, plus roughly €700 million in tariff-related expenses. Leiters, who took over as CEO in January, told shareholders in June that "the streamlining of the company planned so far will not be enough" to restore competitiveness.

The 2035 timeline extends beyond the current agreement's 2030 expiration, providing political cover for near-term cuts while deferring the next crisis. By the time the new guarantee expires, Leiters will likely be gone and the works council will negotiate another round. In December, Aslan warned that management was threatening to move development and production to lower-wage countries, putting "one in four jobs at Porsche AG at risk." The deal resolves that standoff by keeping production in Germany while shrinking headcount to match reduced volume.

Even premium automakers with 15%+ historical margins can't escape European industry restructuring. The difference is that German co-determination law forces them to restructure through negotiated compromise rather than unilateral action. Porsche will present its full Strategy 2035 at an October 7 Capital Markets Day. The works council already has what it came for.