Porsche Shuts Down Three Subsidiaries Amid Sales Slump and Strategic Overhaul

Porsche Closes Three Subsidiaries in Major Corporate Restructuring

German luxury automaker Porsche has announced the closure of three of its subsidiary companies as part of a sweeping corporate restructuring effort driven by falling sales and shrinking profits. The move will affect more than 500 employees across the affected divisions.

"We must refocus on our core business," said Porsche CEO and Executive Chair Michael Leiters. "This is the indispensable foundation for a successful strategic realignment. This forces us to make painful cuts — including our subsidiaries."

Which Subsidiaries Are Being Shut Down?

Cellforce Group — Battery Research Division

The most prominent of the three closures is Cellforce Group, Porsche's battery subsidiary. The division had already undergone a significant restructuring back in August, when Porsche abandoned its ambitions to manufacture its own proprietary batteries and repositioned Cellforce as a pure research and development unit. Now, even that scaled-back version of the business is being wound down entirely.

In its place, Porsche is adopting what it calls a "technology-open powertrain strategy" — a phrase that signals the company will increasingly depend on external suppliers for its battery technology rather than developing it in-house.

The shift marks a dramatic reversal from the company's earlier vision. Back in 2022, then-executive board chair Oliver Blume declared that "the battery cell is the combustion chamber of the future," underscoring just how central in-house battery development once was to Porsche's electric vehicle ambitions.

Porsche eBike Performance

Also on the chopping block is Porsche eBike Performance, the subsidiary responsible for developing drive systems for electric bicycles. The division's closure reflects Porsche's decision to narrow its focus strictly to its core automotive business.

Cetitec — Networking Software

Rounding out the closures is Cetitec, a software subsidiary specializing in networking solutions that served both Porsche and the broader Volkswagen Group. Its shutdown signals a further retreat from technology ventures that sit outside Porsche's primary automotive operations.

A Company in Retreat From Ambitious Ventures

This latest round of closures fits into a broader pattern of retrenchment that has defined Porsche's strategy since Leiters took the helm earlier this year. In March, he outlined plans to make the company "leaner, faster," and to make its products "even more desirable."

Since then, Porsche has systematically divested itself of peripheral interests. In April, the company reached an agreement to sell its equity stakes in both Bugatti Rimac and the Rimac Group to a consortium led by New York-based investment firm HOF Capital.

Declining Sales Add Pressure Across Key Markets

The restructuring comes against a backdrop of deteriorating sales performance across several of Porsche's most important markets. In North America, sales declined by 11% during the first quarter of the year, while deliveries in China dropped a steep 21%. European sales were also down 18%, with only Germany posting a modest uptick.

Porsche has pointed to sluggish EV adoption as a contributing factor to its struggles. However, the company's especially poor showing in China — a market where electric vehicles now account for more than half of all car sales — suggests the real challenges may run deeper than consumer reluctance to go electric.

Porsche's EV Journey: Promise Followed by Setbacks

Porsche's foray into electrification began on a high note with the launch of the Taycan in 2019, which was widely praised as a compelling luxury EV. However, the company's efforts to build on that momentum quickly ran into trouble.

The electric version of the Macan was delayed by nearly two years, largely due to software development bottlenecks within Volkswagen's Cariad division. Those delays damaged confidence and disrupted the brand's EV expansion timeline.

In response, Porsche has shifted considerable attention back toward reviving internal combustion engine platforms — a move that contradicts the company's earlier projection that EVs would represent the majority of its sales by 2030.

What Comes Next for Porsche's EV Lineup?

Despite the setbacks, Porsche has not abandoned electric vehicles altogether. The gas-powered version of the Macan is expected to be phased out in the near future, and the company is preparing to launch an all-electric Cayenne along with several variants. These upcoming releases will be critical tests of whether Porsche can regain momentum in the EV space while simultaneously tightening its operational focus.

With over 500 jobs lost and three subsidiaries shuttered, the scale of this restructuring makes clear that Porsche is willing to make difficult decisions in pursuit of long-term stability — even if it means walking back some of its most ambitious technological bets.