Porsche AG posted a larger-than-expected operating loss in the third quarter, plunging the luxury carmaker into deeper financial trouble amid U.S. tariffs, weakening Chinese demand, and challenges in its electric vehicle (EV) transition.
Heavy Losses Amid Market Pressure
The German automaker reported a €966 million ($1.1 billion) operating loss for the quarter, compared with a €974 million profit a year earlier.
Analysts had forecast a smaller loss of around €611 million for the July-to-September period.
Porsche attributed the shortfall largely to expenses linked to its decision to scale back EV production and abandon plans for in-house battery manufacturing.
Tariffs, Price Wars, and Weak Chinese Sales
Once hailed as a symbol of German engineering excellence, Porsche has been hit hard by global headwinds.
A price war in China and steep import tariffs in the United States have strained profit margins and sales across key markets, including Europe, North America, and China.
Finance chief Jochen Breckner said, “We expect 2025 to be the trough that precedes a noticeable improvement for Porsche from 2026 onwards.”
He warned that large-scale restructuring talks with labor representatives would be critical to long-term recovery.
Restructuring and Leadership Changes
Porsche expects its profit margin to rebound to a high single-digit percentage in 2026, compared with a best-case scenario of 2% for this year.
Breckner added that tariffs will cost the company roughly €700 million in 2025 and confirmed that Porsche plans to propose a lower dividend than the €2.31 per share paid for 2024.
CEO Oliver Blume, who also leads Volkswagen, will step down from Porsche at the start of 2026.
Former McLaren CEO Michael Leiters is set to succeed him.
Leiters will inherit one of the most difficult turnarounds in the European auto industry.
Job Cuts and Outlook
Porsche has already announced 1,900 job cuts over the coming years, in addition to 2,000 temporary layoffs this year.
A second cost-saving package, focused on salary structures and bonuses, is under discussion.
China, once Porsche’s key growth driver, is expected to remain weak through 2026.
“We have to assume that the general market conditions will not improve in the foreseeable future,” Breckner said.
Porsche maintains its 2025 guidance, forecasting a return on sales of up to 2%, down sharply from 14% last year.
The automaker expects a €3.1 billion hit from its EV strategy overhaul and associated restructuring costs.