I can get an off-the-shelf Xeon-D 8-core processor that runs at 35W and any single core would STOMP every ARM chip on the market. If I were to build that chip specifically for a car platform my power envelope would drop accordingly.
https://ark.intel.com/products/family/87041/Intel-Xeon-Proce...
This is an embedded application... not a gaming computer. If I move to Atom - which is what would likely be used for this sort of thing, you're talking less than 5W.
https://en.wikipedia.org/wiki/List_of_Intel_Atom_microproces...
Correct. But Atom processors performance are no better than the competition and don't currently have any of the common automotive peripherals (CAN for example).
Regardless, you're missing the point. Intel has the means to get into the space and create appropriate CPUs to compete. This acquisition makes it clear they're planning on doing just that.