Mercedes-Benz and Porsche cut thousands of jobs in China amid steep sales declines

Mercedes-Benz's Chinese operations are reducing staff across several divisions, including research and development, where the company plans to cut about 10% of its workforce. Compensation for departing employees varies, with some receiving the statutory minimum (N) and others up to N+9, according to recent reports.

Porsche announced a broader restructuring that could affect up to 3,900 positions. The German automaker has already eliminated 2,000 temporary roles and intends to phase out another 1,900 jobs over the coming years. The cuts come as Porsche’s operating margin fell to roughly 1% and sales in China dropped 26% last year, prompting a shift from volume growth to profitability and lower production targets.

Both companies cite weak demand in the Chinese market and rising costs as key drivers of the layoffs, and they are negotiating restructuring agreements with employee representatives.