Intel to Shutter Automotive Chip Design Business, Lay Off Workforce: Report

The latest casualty in Intel’s push to streamline operations and reduce costs is its small automotive chip design business, according to a local news report from Oregon where the chipmaker has a large R&D campus. Under new CEO Lip-Bu Tan, the company has already announced major layoffs and an effort to refocus on engineering and product development. Intel plans to reduce its operating expenses by $500 million in 2025, and an additional $1 billion in 2026 as it works to turn around a years-long decline exacerbated by product delays and reduced competitiveness.

Intel competes with Nvidia, MediaTek, Qualcomm, and others in the automotive business as the industry pivots towards software-defined vehicles and electric cars with complex onboard systems slowly become more popular. California-based luxury automaker Karma announced a “bilateral collaboration” with Intel in August 2024, to equip its upcoming Karma Kaveya super coupe with Intel’s hardware and develop B2B solutions and platforms for other automakers.

Intel just announced its second-gen AI-enabled SoC lineup for the automobile industry in April this year, promising scalability and cost reductions. ADAS features, digital cockpits, graphics-rich personalised interfaces, natural-language voice control, and in-car compute platforms were among the automotive requirements that Intel stated it would offer competitive and energy-efficient silicone products for.

The company also announced its entry into the automotive GPU market in late 2024, projecting growing demand for a scalable development platform using open standards, allowing carmakers to differentiate themselves in a crowded market. The Intel Arc Graphics for Automotive A760A GPU was intended to enable modern AI applications and even games to run on a car’s onboard computer.