Intel shuts down automotive business: Comprehensive corporate restructuring and layoffs

Restructuring Intel Exits Automotive Division

2025-07-02 By Sven Prawitz | Translated by AI 2 min Reading Time

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Intel is shutting down its automotive business and laying off the majority of its workforce in this area. The decision is part of the comprehensive corporate restructuring announced by Intel CEO Lip-Bu Tan.

A live demo of Intel's AI-powered solution for Software-Defined Vehicles (SDV) at CES 2025 in Las Vegas. In 2017, Intel had still regarded its automotive division as a major growth sector for the company. Now, according to media reports, the division is to be dissolved.(Image: Intel Automotive) — A live demo of Intel's AI-powered solution for Software-Defined Vehicles (SDV) at CES 2025 in Las Vegas. In 2017, Intel had still regarded its automotive division as a major growth sector for the company. Now, according to media reports, the division is to be dissolved.
(Image: Intel Automotive)

Intel is withdrawing from the automotive technology business. As first reported by the local news portal The Oregonian/Oregon Live, the U.S. chip manufacturer will close its automotive division and lay off most of its employees. The decision is part of a larger restructuring effort as Intel responds to declining revenues and increased competition.

Former Hopeful Division

The company confirmed the decision to several media outlets and emphasized that it would focus on its core business of processors for client and data center applications in the future. Intel will continue to fulfill existing customer commitments in the automotive sector but will "eliminate the majority" of jobs in the affected department. The company has not yet specified the exact number of impacted positions.

With its withdrawal, Intel closes a chapter that had symbolized hope since the acquisition of Mobileye in 2017. While Intel remains the majority shareholder of the publicly traded company, the automotive architecture within the Client Computing Group is not affected. Previous acquisitions such as Moovit or investments in software-defined vehicles thus lose relevance within the corporation.

Announced corporate restructuring underway

At the beginning of the year, Intel Automotive showcased its system-on-chip solutions for connected vehicles at CES 2025. The company was also present at the Shanghai Auto Show in April – but even then, the division's uncertain future was looming. The new CEO, Lip-Bu Tan, had internally warned of a strict cost-saving course.

Tan, who took over the leadership of the company in March 2025, is pursuing a radical realignment: smaller, more efficient, more innovative. Among other things, the foundry business is set to lose up to 20 percent of its workforce starting in July. Marketing will rely on external service providers in the future – layoffs are also expected there.

Possible entry into AI business

For the electronics industry, Intel's move is a clear signal: the corporation is reorganizing and setting clear priorities. The focus is on the battle for market share in the PC and data center sectors as well as a potential entry into the high-growth artificial intelligence market. What the restructuring specifically means for the competitiveness of Intel's products remains unclear for now.

After three years of recovery, the global supplier industry is stumbling again in 2024. There is a glimmer of hope. (Image:sizsus - stock.adobe.com / [M] / AI-generated)

The fact is: With the end of its automotive division, Intel is withdrawing from an industry that is continuing to grow in importance. For suppliers and partners in the automotive sector, the question now arises of how to continue ongoing projects—and which suppliers they want to work with in the future. (sp)

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Date: 08.12.2025

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