Porsche prepares new strategy as profit margin slumps to 1.1 percent

German automaker Porsche is facing significant challenges after its profit margin slumped to just 1.1 percent last year. According to a CarsCoop report on Tuesday (23/6), Porsche is pushing to prepare a new strategy through to 2035 to restore profitability and strengthen competitiveness amid intense global automotive industry rivalry. Porsche CEO Michael Leiters, speaking at the company’s annual general meeting this week, revealed that the decline in performance was the main reason behind the birth of ‘Strategy 2035’. Leiters, who took office on 1 January 2026, said Porsche will focus on three key aspects: strengthening the brand and customer relationships, simplifying products and technology, and improving operational efficiency. Amid weakening profitability, Porsche stressed it will not aggressively pursue sales volume increases. On the product side, Porsche will cut a number of model variants. This move has already begun with the discontinuation of two Taycan wagon variants in the United States. While accelerating electrification, the company will retain its existing internal combustion engines and hybrid technology. The company also plans to expand the use of shared platforms with Volkswagen Group and implement efficiency measures, including workforce reductions and operational cost savings. Chairman of the Supervisory Board Wolfgang Porsche acknowledged that these steps will not be easy. However, he said the measures are necessary to put Porsche back on a healthy growth path after profits were squeezed to their lowest level in several years.