Chipmaker Intel is shutting down its automotive division and laying off most of the employees working in that segment, according to a report by The Oregonian/OregonLive. The report is based on an internal message Intel sent to employees, which the publication reviewed.
“Intel plans to wind down the Intel architecture automotive business,” the company said in the message. It added that while it will fulfill existing commitments to customers, it will lay off “most” of the workers in that business.
In a written statement to The Oregonian/OregonLive, Intel explained, “As we’ve said previously, we are refocusing on our core client and data center products to better serve our customers. As part of this work, we have decided to close the automotive business within our client computing group. We are working to ensure a smooth transition for our customers.”
Intel’s automotive business isn’t one of its major divisions, the company doesn’t even disclose its revenue or workforce numbers. However, Intel claims that its chips are currently used in around 50 million vehicles globally, powering electric cars, providing driver information, and optimizing vehicle performance.
The closure does not impact Mobileye, the Israeli self-driving tech company in which Intel holds a majority stake. Mobileye will continue to operate independently.
This move is part of a larger wave of cost-cutting under new CEO Lip-Bu Tan, who warned employees earlier of “several months” of layoffs amid falling sales and a gloomy revenue outlook. While Tan hasn’t publicly shared a revival strategy yet, internal changes are gradually surfacing.
Just this month, Intel told manufacturing staff that up to 20% of jobs in that unit could be cut starting July. Last week, the company informed marketing employees that it will outsource marketing operations to Accenture, resulting in more layoffs.
Together, these sweeping changes signal Intel’s push to become a leaner, more efficient company, but they also bring major uncertainty for its workforce.
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