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US senator presses Intel CEO on chips award after job cut plan
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US senator presses Intel CEO on chips award after job cut plan
Aug 31, 2024 4:53 AM

WASHINGTON, Aug 28 (Reuters) - Republican Senator Rick

Scott on Wednesday asked Intel ( 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 ( INTC ) 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 ( INTC )

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 ( INTC ) 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 ( INTC ) 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 ( INTC ) to detail how many U.S. employees will

lose their jobs and whether the cuts will impact Intel's ( INTC ) planned

semiconductor manufacturing investments.

"What is Intel ( INTC ) 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.

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