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Intel is shutting down its automotive chip business as part of its ongoing restructuring effort, the company confirmed.
Layoffs have already begun, with 107 employees in Santa Clara, California, notified of job losses set to take effect in mid-July, according to state WARN filings.
“We are refocusing on our core client and data center portfolio to strengthen our product offerings and meet the needs of our customers,” the company said in a statement.
“As part of this work, we have decided to wind down the automotive business within our client computing group,” the firm said. “We are committed to ensuring a smooth transition for our customers.”
Intel has not disclosed specific numbers regarding layoffs tied to the closure of its automotive unit. A spokesperson said: “Intel does not disclose the number of affected employees based on specific region, location or business.”
Approximately 50 million vehicles use its processors, with 18 automotive equipment manufacturers currently partnering with the chipmaker. The company does not provide specific earnings data for its automotive arm, though the broader client computing group brought in $7.6billion in the first quarter of 2024, representing around half of Intel’s total revenue.
Factory layoffs to affect chipmaking workforce
The company is also preparing to cut up to 20% of its factory workforce in July. These reductions are part of an effort to “rightsize Intel and put it on solid footing for the future,” according to an April memo from CEO Lip-Bu Tan.
“These are difficult actions but essential to meet our affordability challenges and current financial position of the company. It drives pain to every individual,” Intel manufacturing Vice President Naga Chandrasekaran told employees.
Intel previously eliminated 15,000 roles in 2024, including 3,000 in Oregon. The July layoffs, expected to impact the company’s Intel Foundry unit, are not anticipated to include buyouts or early retirement options.
“These reductions will be based on a combination of portfolio changes, level and position elimination, skill assessment for remaining positions, and some hard decisions around our project investments,” Chandrasekaran wrote. “We are also taking into consideration factory operations impact.”
The company, which had 109,000 employees at the end of 2024, said it will “treat people with care and respect as we complete this important work.”
Intel added: “Removing organizational complexity and empowering our engineers will enable us to better serve the needs of our customers and strengthen our execution. We are making these decisions based on careful consideration of what’s needed to position our business for the future.”
