Porsche’s new chief executive Michael Leiters had an unfamiliar message for staff: Bonuses should reflect performance.
At an event in New York on Thursday, Leiters and his new chief designer, Tobias Sühlmann, launched an early prototype of the kind of low-slung, elongated model they want to build for an even more rarefied market than the company’s iconic 911 sports car. Last year the company issued a string of profit warnings and ended up reporting less than half a billion dollars in net income, down from $5.6 billion in 2023. This year, German staff didn’t receive a customary annual bonus, which exceeded $10,000 in 2024. Leiters also wants to sell more one-off or limited-edition versions of existing Porsche models, prices for which can stretch to $15 million. The overall plan involves finding ways to increase the average price of the 10,000 most expensive Porsches sold each year to the equivalent of around $370,000, the company said, from $300,000 today. In July, the CEO came to a deal with the company’s union representatives that more than doubled job losses at the company to around 9,000 by 2035, or around a fifth of the total workforce. The agreement also signaled a cultural shift, cutting the number of days a month Porsche staff can work from home to eight from 12 and linking the traditional annual bonus more closely to financial performance.
At employee meetings this summer, Leiters said the sports-car company’s annual payouts—for years among the most generous and reliable in the German car industry—weren’t a given, and they would depend on a recovery in the company’s profit for which everyone was individually responsible, according to attendees. One way to achieve this, he said: Staff needed to be in the office more. “I don’t expect this environment to begin to become significantly easier over the next few years,” Leiters told journalists last week as he unveiled a highly anticipated turnaround plan.
“The only sensible approach is to focus on what we can influence ourselves to improve our competitiveness, to make the company leaner, faster, more resilient, and to put our own house in order. Also part of the plan: even more expensive sports cars. Leiters, who joined Porsche in January after more than a decade at supercar brands McLaren and Ferrari, is betting that new vehicles at the top end of Porsche’s product range will in time help restore the company’s bottom line. In addition to supercars, a three-row SUV is in the works that would be more expensive than the company’s current Cayenne model.
