*

FY margin seen in lower 5-7% range

*

Outlook includes 15% US tariff, possible price adjustments

*

Negotiations planned for H2 on jobs cuts

(Adds details on tariff response, restructuring from paragraph

7)

By Rachel More

BERLIN, July 30 (Reuters) - Volkswagen's embattled

luxury brand Porsche cut its full-year profitability

target on Wednesday after the EU's trade deal with U.S.

President Donald Trump and reported a 400-million-euro

($462-million) hit from tariffs in the first half.

The burden of tariffs on car imports to the United States

only added to Porsche's woes, as it undergoes a costly

restructuring while facing weakness in critical market China and

a sluggish transition to electric cars.

"We continue to face significant challenges around the

world. And this is not a storm that will pass," Porsche CEO

Oliver Blume said.

Taking into account the newly agreed tariff of 15% from

August 1, the German carmaker expects group sales this year in

the range of 37 billion to 38 billion euros, in line with its

previous forecast, and a return on sales of between 5% and 7%,

down from a previously expected 6.5% to 8.5% range.

Countermeasures such as price adjustments are included in

that outlook as Porsche seeks to mitigate the damage, the

company said.

Costs amounting to 1.3 billion euros related to the

company's restructuring were also included, it said.

Group figures released last week showed Porsche's operating

profit collapsing by 91% year on year in the second quarter, to

154 million euros.

COMBUSTION ENGINES AND CUTS

Outlining the carmaker's response so far to U.S.

tariffs, Porsche CFO Jochen Breckner said the company had

already raised its U.S. prices by between 2.3% and 3.6% in July.

It currently has no plans to establish a U.S. production

presence - a move that would allow it to avoid tariffs - but is

assessing the situation, he added.

As for any sector-specific deal with Washington to lower

trade barriers further, Blume told reporters he agreed with

Mercedes CEO Ola Kaellenius that this would not

happen.

Porsche's ongoing overhaul involves pivoting back to

combustion engine vehicles by investing in new models and

restructuring its battery business in the face of low demand for

its EVs in Europe and intense competition from local rivals in

China.

In the first half, Porsche booked special expenses for the

company's realignment of around 200 million euros and around 500

million euros for battery activities.

"We expect that we will begin to see positive economic

momentum again from 2026 onwards," Blume said.

In February, Porsche announced an additional 1,900 job cuts

over the next four years but said it could not announce any

forced redundancies due to a location safeguarding agreement

valid until 2030.

On Wednesday, Porsche said its management was "resolutely

pushing ahead with extensive measures to rescale and recalibrate

the company", with negotiations with employee representatives to

begin in the second half of the year.

Breckner declined to give further details ahead of the

talks.

"What I can say, however, is that there will be painful

cuts and that the package will be far-reaching," he said.

($1 = 0.8655 euros)