Ericsson to plough another $50 million into US 5G facility

The announcement was made during a tour/showcase of Ericsson’s USA 5G Smart Factory with customers, US government officials, media and industry analysts in attendance. The $50 million investment bump will go towards increasing local production to ‘address the demand’ for 5G infrastructure made in the US – as compliant with the Build America Buy America Act (BABAA).

The expanded 300,000-square-foot ‘highly automated’ smart factory employs more than 500 people, and this expansion will allow Ericsson to deliver existing and new radios and basebands (RAN Compute) for US customers, including Open RAN-ready products, we’re told.

It opened in 2020 and has been shipping 5G network products, including 5G and Massive MIMO radios, to ‘all tier-one communications service providers in the US.’

Yossi Cohen, President and Head of Ericsson North America said: “This 5G Smart Factory ensures we are working closely to secure fast and agile deliveries to meet US customer requirements, and it has been exciting to see the growth and innovation of our state-of-the-art facility in just a few short years. With this expansion, we can accelerate the production of Ericsson’s advanced Massive MIMO radios and our latest RAN Compute platform, all proudly made in the USA, addressing the evolving demands of our US customers and reinforcing our commitment to technological leadership.”

Telecoms has become highly politicised in recent years which has taken the form of banning Chinese vendors from building networks in the US and allied nations, projects to seed the Open Ran market and increase the number of vendors in the ecosystem, and lots of rhetoric around retaining US technological leadership and manufacturer onshoring in various wider tech areas, such as chip production.  

White House Office of Science and Technology Policy’s Asad Ramzanali said: “President Biden is laser focused on bringing fast, affordable, and secure connectivity to every part of our nation so that all Americans can share in the benefits of the digital age. The Biden-Harris Administration is supporting unprecedented investments in communications infrastructure, including 5G, right here at home — creating good jobs, more secure networks, and continued U.S. leadership in wireless technology. Today’s announcement is welcome news that will help support ongoing work to connect more Americans.”

United States Senator Ted Cruz added: “Ericsson is proving once again that Texas is the best place in the country to do business. This new smart factory is bringing not only cutting-edge technological production to our state, but the high paying skilled jobs that go along with it. This is a huge win for our state, and for the people of Lewisville and the whole Dallas-Fort Worth region.”

Jubilant statements from US politicians over a boost to local manufacturing aside, the wider picture for Ericsson is somewhat more downbeat. In March it announced it was to cut 1,200 more jobs in Sweden and said it “expects a challenging mobile networks market in 2024, with further volume contraction as customers remain cautious.” In previous quarterlies, Ericsson pointed to ‘unsustainably low’ operator investment levels.

Providing ‘a huge win’ for the state of Texas gives Ted Cruz something to crow about, but the kit vendor will surely be hoping that investing into its US facility will ultimately have a positive impact on its sales of telecoms kit in the region as well.