Porsche Targets Higher Margins With Sportwagenschmiede '35 Strategy

Porsche has outlined a new strategy through 2035 that targets higher profitability, lower costs and a more focused product portfolio, while reducing its break-even point to fewer than 200,000 vehicles.

The strategy, named ‘Sportwagenschmiede ’35’, was presented at the company’s Capital Markets Day at its Weissach development centre. Porsche said it will focus on higher-value products, greater pricing power, lower portfolio complexity and a leaner organisational structure. 

In the medium term, Porsche is targeting a 10-15 percent Group operating return on sales and an Automotive net cash flow margin of 9-12 percent. Its long-term targets are a 15 percent operating return on sales and a 12 percent Automotive net cash flow margin. 

The strategy comes as Porsche works to recover profitability amid weaker demand in China and restructuring costs. Reuters reported that Porsche’s operating return on sales fell to a record-low 1.1 percent in 2025, before improving to 7.8 percent in the first half of 2026. Reuters also reported that Porsche’s China sales had more than halved from their 2021 peak.

Porsche Targets Lower Costs And Smaller Workforce

Porsche has agreed a Future Package with employee representatives that includes a reduction of 9,000 jobs and a commitment to protect its core workforce through 2035. The company also plans to reduce its overall workforce by 25 percent in the medium term, with a longer-term target of 30 percent. Management positions are expected to decline by 40 percent. 

Porsche Cost Reduction Targets For Development, Production And Sales

The restructuring also targets several areas of operating expenditure. Porsche aims to reduce development costs for future model lines by up to 20 percent, production personnel costs by up to 30 percent and sales and distribution costs by 20 percent. Material costs for new vehicle projects are targeted to fall by around 10 percent compared with previous plans.

Porsche Technologies: Porsche Engineering And Porsche Digital To Merge

Porsche will also merge Porsche Engineering and Porsche Digital into a new entity called Porsche Technologies. The company said the move is intended to consolidate development capabilities and reduce costs. 

Porsche To Cut Model Variants And Expand High-Margin Segments

The new strategy calls for around 20 percent fewer model variants, with Porsche targeting a roughly 30 percent increase in sales volume per variant in the medium term. The company also plans to increase the share of D- and E-segment models in its portfolio by around 45 percent.

New Porsche Models Planned Through 2030 And Beyond

Porsche is also developing a mid-engined super sports car platform for a model line positioned above the 911. It is strengthening the 911 range with additional derivatives and is exploring a D-segment SUV positioned above the Cayenne. 

The company plans to launch at least one new brand-defining product every year through 2030. Its powertrain strategy will continue to cover internal combustion engines, plug-in hybrids and battery-electric vehicles, with further investment planned across all three areas. 

Porsche 718 Boxster, Cayman, Macan And New SUV Launch Timeline

Porsche's near-term product expansion includes the all-electric 718 Boxster and Cayman, which are expected to contribute to sales in their first full year of production in 2028. A new B-segment SUV with internal combustion and plug-in hybrid powertrains is also due in 2028, alongside the electric Macan, with Porsche expecting it to contribute to sales and profitability from 2029.

Porsche Targets Higher Pricing And Lower Break-Even Point

Alongside the portfolio changes, Porsche plans to increase the average selling price of its top-end models by around 20 percent in the medium term. It also aims to expand its individualisation business, with sales from its Sonderwunsch programme targeted to increase sixfold. 

The company is targeting a break-even point below 200,000 vehicles, based on what it describes as a conservative forecast for China. Porsche's medium-term revenue target is €41 billion-€45 billion. 

Porsche expects investment and research and development expenditure to decline after a projected peak in 2026, with the company targeting a more focused approach to capital allocation.