Ericsson intends to consolidate four of its existing facilities in Estonia into a single, state-of-the-art smart hub complete with test labs, warehouses, production lines and offices.
It’s still in the early stages. Ericsson said its Estonian affiliate signed a definitive agreement to acquire property to build the smart hub, with the transaction expected to close in the fourth quarter of 2024, subject to conditions.
The fully connected hub will be in Ülemiste City in Tallinn, described as the largest business park and future-oriented urban area in the Baltics. The hub is expected to be operational in early 2026, with Ericsson aiming for it to be LEED Gold-certified during that same year.
According to Ericsson, the new 50,000-square-meter facility – valued at about $169 million – has sustainability and operational efficiency top of mind. It will be mainly used for customers and partners in Europe but with a global impact on its supply chain and manufacturing.
Environmental impact
In a statement, Ericsson EVP and Head of Networks Fredrik Jejdling said the move will strengthen the link between Ericsson’s R&D and new product introduction to ensure every product it makes not only benefits customers but also is produced with as low an environmental impact as possible.
A few years ago, Ericsson opened a smart factory in Lewisville, Texas, where it manufactures 5G equipment for U.S.-based customers. Ericsson at the time said it wanted to locate more manufacturing operations closer to its customers in order to mitigate potential risks or regional disruptions and reduce dependence on one supply site or vendor.
The new European hub is expected to reduce its carbon emissions by up to 70% compared to all four existing facilities in Tallinn. It will support Ericsson’s 2030 target to be Net Zero in its own operations through an energy-efficient design, including the use of low embodied carbon wooden glulam beams and a solar farm on the roof.
Jejdling also said this new smart hub will be powered 100% by renewable electricity and built with optimal efficiency through AI, machine learning, robotics and other advanced Industry 4.0 technologies.
Ericsson currently has more than 2,200 employees in Estonia, including engineers and experts in AI and machine learning. The existing factory accounts for more than 40% of the manufacturing of Ericsson 5G products.