US senator presses Intel CEO on chips award after job cut plan

By David Shepardson

WASHINGTON (Reuters) - Republican Senator Rick Scott on Wednesday asked Intel (NASDAQ:INTC ) CEO Pat Gelsinger for more details on the company's plans to cut more than 15,000 jobs despite being set to receive nearly $20 billion in U.S. grants and loans to boost chip production.

In a letter seen by Reuters, Scott questioned if the Commerce Department's planned awards had failed "to include real metrics that would protect taxpayer dollars from going to companies that could not meet high standards for U.S. manufacturing and job creation."

The Commerce Department in May announced a preliminary agreement for $8.5 billion in grants and up to $11 billion in loans for Intel as well as access to a 25% investment tax credit. The chips award has not been finalized.

The agency declined to comment on Scott's letter and Intel did not immediately respond to requests for comment.

The Commerce Department said in May the funding will support the creation of more than 10,000 manufacturing jobs and nearly 20,000 construction jobs for projects in Arizona, New Mexico, Ohio and Oregon.

Intel said this month it would cut costs by $10 billion in 2025 and reduce its workforce by more than 15%, with a majority of the exits completed this year.

Gelsinger said at the time Intel's workforce is 10% larger than it was in 2020, when its revenue was $24 billion higher than in 2023 and he needed fewer people at headquarters and more in the field supporting customers.



Scott wants Intel to detail how many U.S. employees will lose their jobs and whether the cuts will impact Intel's planned semiconductor manufacturing investments.

"What is Intel trying to achieve with these job cuts, and why have billions of U.S. taxpayer dollars in investments not been sufficient support to avert the need for lay-offs?" Scott asked.

Source: Investing.com