Intel Begins Major Round of Layoffs in Israel Including Kiryat Gat Manufacturing Plant

 Intel has begun a new wave of layoffs in Israel, marking the first time in years that employees at the company’s chip manufacturing plant in Kiryat Gat are among those affected. According to sources familiar with the matter, employees at the Kiryat Gat site were summoned for hearings beginning Monday, with estimates suggesting the number of layoffs could reach into the hundreds.

In addition to Kiryat Gat, development groups within Intel Israel are also seeing staff reductions. The layoffs appear to align with a broader global restructuring under new CEO Lip-Bu Tan, who previously signaled cuts focused on middle management.

Management Targeted, Broader Layoffs Expected

Initial cuts at Kiryat Gat have reportedly focused on production control teams and mid-level managers. Some managers are being laid off, while others are being reassigned to individual contributor (IC) roles. At this stage, junior engineers and line workers are less impacted—but insiders warn additional cuts may follow.

Intel has not issued a public statement on the current round of layoffs in Israel.

Global Strategy: 15–20% Cuts in Manufacturing

The current layoffs are part of a larger global cost-cutting initiative, as outlined last month by Naga Chandrasekaran, Intel’s VP of Manufacturing. In a letter to employees, he stated that the company plans to lay off 15–20% of its manufacturing workforce worldwide, a figure that could total more than 10,000 employees.

“These are difficult but essential steps to deal with the challenges of the company’s budget and current economic situation,” Chandrasekaran wrote.

Kiryat Gat’s Role and Future Uncertain

The Kiryat Gat Fab28 plant, which once employed over 4,000 workers, plays a critical role in Intel’s global production but uses older 10-nanometer chip technology. Intel is also building a new facility, Fab38, in Kiryat Gat, but its launch timeline remains uncertain and dependent on market conditions.

Although Intel has relied on voluntary retirements in previous years, this is the first large-scale round of layoffs at the plant itself.

Shrinking Workforce in Israel

Intel’s presence in Israel has already diminished in recent years:

• 2022: 11,700 employees

• End of 2023: 10,800 employees

• Mid-2025: Approximately 9,350 employees – a 13% decrease in less than two years

The current layoffs are expected to further reduce that number.

Intel’s restructuring comes as the global semiconductor industry faces slowing demand, rising costs, and intensifying competition from rivals such as TSMC and Samsung. While Intel remains a key player in Israel’s tech ecosystem, the latest developments raise questions about its long-term commitment to local manufacturing and R&D investment.