Volkswagen's restructuring initiative could result in further reductions at Porsche, according to a report by the German business daily Handelsblatt. The plan, which outlines the most extensive restructuring in the company's history, proposes cutting approximately 4,100 positions at the Stuttgart-based sports car division. The proposal follows a profit warning tied to challenges within the subsidiary and reflects an effort to address an overhead shortfall of roughly €700 million.

The proposed cuts would be in addition to previously agreed-upon reductions. In July, Porsche management and labor representatives had already committed to eliminating 5,000 jobs, supplementing an earlier target of 4,000 layoffs. Together, these measures would account for about one-fifth of the workforce by 2035.

Volkswagen has not confirmed the details of the plan, and a Porsche spokesperson declined to comment on the reported proposals. The parent company can only advise on such actions and does not have direct authority over Porsche's operational decisions.

The restructuring comes as Volkswagen revises its financial outlook, lowering its full-year profit margin target to 1% from a prior range of 4.0% to 5.5%. This adjustment follows a significant write-down at Porsche, where CEO Michael Leiters faces pressure to develop a recovery strategy amid declining sales in China and a strategic shift away from electric vehicle investments.

The situation underscores broader challenges facing Germany's automotive sector, as manufacturers navigate shifting market demands and technological transitions.