Intel bets on China’s EV market with new AI chip
Intel, the once-dominant chipmaker struggling to stay relevant amid intense competition and slumping growth, is moving into China’s booming electric vehicle (EV) market. The company has launched a new graphics processing unit (GPU) designed specifically for in-car AI applications, even as it faces pressure from Washington to limit high-tech exports to China.
The California-based company unveiled its Arc Graphics for Automotive discrete GPU at a product launch event in Shenzhen on 8 August 2024. This move comes as Intel grapples with disappointing financial results that have sunk its shares by nearly 60% this year, forcing the company to announce plans to lay off more than 15% of its workforce – some 17,500 employees – as part of drastic cost-cutting measures.
Despite these challenges, Intel is doubling down on the world’s largest EV market. “China’s rapid EV development cycles and advanced technological adoption make it an ideal testing ground for our next-generation technologies,” said Jack Weast, VP and GM of Intel Automotive, in a statement released for the event.
The new chip, part of Intel’s Arc Series discrete GPUs first launched in 2022 for video gaming laptops, promises to “run full large language models (LLMs) inside the car” and enable “triple-A gaming experiences,” as well as run generative AI applications locally rather than relying on cloud computing. This push into automotive AI reflects the growing demand for computing power in increasingly sophisticated vehicle cockpits. US semiconductor rivals Nvidia and Advanced Micro Devices also ramped their efforts in this market segment.
Intel defies geopolitical tensions with focus on China
Intel’s move to focus on the Chinese market is particularly noteworthy given the ongoing tensions between Washington and Beijing. The US Government has been pressuring semiconductor firms to restrict high-tech exports to China, citing national security concerns. However, Intel seems to be charting its course, seeking to deepen ties with the world’s second-largest economy.
This strategy is evident in Intel’s recent actions in China. In July 2022, the company partnered with the Nanshan district government in Shenzhen to launch the Intel Greater Bay Area Innovation Centre, focusing on technologies including AI and edge computing. More recently, Intel decided to move the headquarters of its automotive unit to mainland China, with Weast himself relocating to Beijing.
Overall, the launch of the Arc Graphics for Automotive GPU is not just about entering a new market segment; it’s also about offering a scalable platform for automakers. Intel claims its solution allows car manufacturers to design a single-vehicle platform that scales across different trim levels. Entry and mid-level models can leverage Intel’s software-defined vehicle (SDV) system-on-chips (SoCs). In contrast, higher-end vehicles can benefit from the added horsepower of the discrete GPU for more premium features.
This approach could be particularly appealing to Chinese automakers known for their rapid development cycles and eagerness to incorporate cutting-edge technologies. By offering a flexible and scalable platform, Intel is positioning itself as a key partner in the evolution of smart vehicles in the world’s largest auto market.
However, Intel’s strategy has risks. The company’s decision to deepen its engagement with China comes at a time of high geopolitical tensions, and the global semiconductor industry is increasingly caught in the crossfire of US-China relations. There’s also the question of whether Intel can effectively compete in a market where it’s playing catch-up to more established players in the automotive chip space.
Moreover, Intel’s pivot to China and the automotive sector comes as the company faces significant internal challenges. The recently announced layoffs are part of a broader restructuring effort to cut costs and streamline operations. When asked whether the job cuts would affect employees on the mainland, Intel told Chinese news outlet Jiemian that the layoffs are “global” without providing specific details.
As Intel navigates these turbulent waters, the success of its automotive AI initiative in China could prove crucial. If the company can establish a strong foothold in this rapidly growing market, it might find the lifeline it needs to regain its footing in the global semiconductor industry. However, the path forward is fraught with technological and geopolitical challenges that will test Intel’s ability to innovate and adapt in an increasingly complex global marketplace.
(Photo: Intel)
See also: US plans to ban Chinese tech in autonomous vehicles
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