Previously, we mentioned Intel will lay off 15% to 20% of its employees. Today, the company announced it will shut down its automotive business. So, what should you know about it?
Intel confirms closure of automotive division
The closure affects a relatively small part of Intel’s operations, but one that had been responsible for supplying chips to approximately 50 million vehicles globally. Intel stated it will honor all existing customer commitments before completing the shutdown.
According to company spokespersons, the layoffs will impact most of the staff in the automotive group. Severance details have not been disclosed publicly. The decision aligns with Intel’s ongoing efforts to cut costs and streamline operations under CEO Pat Gelsinger’s leadership.
While Intel is shutting down its in-house automotive segment, it clarified that this change will not affect Mobileye, the autonomous driving tech subsidiary Intel partially spun off in 2022. Mobileye will continue to operate independently and remain part of Intel’s investment portfolio.
Part of a larger restructuring effort
The move follows Intel’s broader cost-cutting initiative, which includes plans to lay off 15 to 20 percent of its foundry workforce, translating to over 10,000 jobs globally.
These layoffs, expected to begin in mid-July 2025, are aimed at addressing Intel’s declining margins and re-prioritizing resources toward AI and advanced chip manufacturing.
This round of workforce reduction follows Intel’s reported net loss of USD821 million (approximately RM3.86 billion) in the first quarter of 2025. Unlike previous rounds, Intel will not offer voluntary buyouts or early retirement packages this time.
The layoffs will be determined based on employee performance, strategic value, and organizational needs.
Strategic refocus on core growth areas
Intel has been aggressively realigning its strategy to focus on high-growth areas, particularly:
- Artificial Intelligence (AI)
- Cloud infrastructure
- Client computing (PC chips)
- Advanced semiconductor fabrication (foundry business)
By exiting its smaller business units, like automotive, Intel hopes to sharpen its execution in markets that offer stronger long-term returns.
The company also aims to empower engineering teams and reduce internal layers to speed up product development and decision-making.
Are Intel’s strategic cuts the right move for future growth, or could shedding smaller segments cost them long-term flexibility? While the company tightens focus on high-growth areas like AI and chip manufacturing, affected teams are left facing uncertainty.
Stay tuned to TechNave.com for more updates.
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