The chip would sit alongside an Intel processor that would still do all the heavy lifting when the computer was awake, much like the Apple T1 chip that powers the new MacBook Pros' Touch Bar. The T310 would be slightly more capable and more deeply integrated into the system than the T1, since it would be allowed to use the computers' Wi-Fi adapters and access RAM and storage. But as described, the chip would still be filling a niche role rather than doing any major processing.
While Bloomberg notes that Apple has "no near-term plans to completely abandon Intel chips," the report frames Apple's new chip as the next step down a road toward "Intel independence." This could eventually lead to Macs that are powered by Apple's own A-series processors rather than standard x86 PC processors; Intel's chip development has slowed significantly in recent years, and the company's roadmap doesn't look as rosy as it did back in 2006 when Apple originally switched away from the PowerPC architecture.
But even so, the development of additional ARM-based co-processors doesn't necessarily mean that fully ARM-based Macs are happening. Apple's current focus on co-processors points to a reluctance to fully leave Intel behind; Apple's A-series chips might be within spitting distance of Intel's low-power dual-core parts, but meeting or beating the performance of a quad-core or octo-core Intel CPU isn't as simple as taping a bunch of cores together. Instead, Apple's current approach suggests that the company is willing to compromise, using its expertise to build small ARM-based chips that enable features Apple can't get from Intel without fully leaving behind Intel's performance and compatibility (or devoting its chip design team's resources to designing huge high-performance chips that will only be usable in a fraction of devices that Apple sells).