Intel has announced plans to wind down its automotive business, leading to layoffs for most employees in that segment. The embattled tech giant recently announced a massive layoff of factory employees — and isn’t out of the woods yet.
OregonLive reports that Intel has decided to shut down its automotive business and lay off the majority of the workers in that segment. This latest step in the chipmaker’s dramatic downsizing was announced to employees on Tuesday morning.
According to the message viewed by OregonLive, the company stated, “Intel plans to wind down the Intel architecture automotive business.” The company assured that it would fulfill existing commitments to customers but would lay off “most” employees working in Intel’s automotive group.
In a written statement to OregonLive, Intel explained, “As we have said previously, we are refocusing on our core client and data center portfolio to strengthen our product offerings and meet the needs of our customers. As part of this work, we have decided to wind down the automotive business within our client computing group. We are committed to ensuring a smooth transition for our customers.”
While automotive technology is not one of Intel’s major businesses, and the company does not report the segment’s revenue or employment, Intel boasts online that 50 million vehicles use its processors. The company claims that its chips can help enable electric vehicles, provide information to drivers, and optimize vehicles’ performance.
Intel owns a majority stake in the Israeli company Mobileye, which develops technology for self-driving cars. However, it appears that the closure of Intel’s automotive group will not directly affect Mobileye’s operations.
This decision to shut down the automotive business comes on the heels of warnings from new CEO Lip-Bu Tan in April. Tan had cautioned employees of “several months” of layoffs in response to falling sales and a bleak revenue outlook. Although he hasn’t publicly divulged a strategy for reviving Intel or given any media interviews since being hired in March, Tan has indicated that he hopes a smaller, more efficient company could be more innovative.
Breitbart News reported earlier this month that Intel is making a massive cut of up to 20 percent of its factory workers:
Intel, the world’s largest chipmaker, is gearing up for a significant reduction in its workforce, with plans to lay off between 15 percent and 20 percent of its factory workers. The announcement, made by Intel manufacturing Vice President Naga Chandrasekaran in a memo to employees on Saturday, underscores the company’s need to address affordability challenges and its current financial position.
The layoffs, slated to take place primarily in July, will impact Intel’s factories around the world, with Oregon, the heart of the company’s manufacturing operation, potentially facing the most significant effects. Intel employs 20,000 people in Oregon, more than any other business in the state.
Last week, Intel informed marketing employees that it would outsource its marketing to the consulting firm Accenture, triggering more layoffs next month. The company is betting that contractors using AI will be more effective in marketing its products.
These cutbacks, both in motion and in the planning stages, are expected to substantially lower Intel’s spending and reshape its fundamental operations. However, the company has not yet articulated how these cost cuts will make Intel chips more competitive with designs from rivals AMD and ARM Holdings, which are taking market share in the PC and data center businesses.
Read more at OregonLive here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
