Lenovo has officially opened its first manufacturing facility in Europe, to locally build servers, storage systems and high-end PC workstations for customers across Europe, Middle East, and Africa.

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Lenovo's new manufacturing facility in Pest. Pic: Lenovo

The factory, located in Üllő in the charmingly named Pest county near Budapest, was sited there because of strong infrastructure, skilled labour and a central location within Europe, according to Lenovo.

However, part of Lenovo’s investment is backed by local government incentives through the Hungarian Investment Promotion Agency (HIPA). And the relatively lower wage structure in the country undoubtedly played a role in selection process too.

The site employs over 1,000 full-time staff in a range of engineering, management and operational roles, and Lenovo said that numbers are continuing to increase as the facility moves towards full capacity.

The initial plan was to construct and open the new factory in [2]Spring 2021 but like so much else in the world in recent years, COVID-19 held up proceedings.

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Lenovo SVP and EMEA president Francois Bornibus welcomed the opening, saying the company had reached a "milestone" in the evolution of its global manufacturing network, which includes a mix of both in-house and contract manufacturing.

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"Hungary's well connected location puts us much closer to our European customers so that we can fulfil and sustain their needs while remaining at the forefront of innovation," he said in a statement. "As our business continues to grow around the world, this incredible new facility will play a key role in our plans to ensure future success and bring smarter technology for all to Europe more sustainably, quickly and efficiently."

Lenovo said the new site is now one of its largest manufacturing facilities. The production lines are said to be capable of churning out more than 1,000 servers and 4,000 workstations a day, with each being built to customer spec.

[6]PC shipments sink amid steady waves of supply chain, war disruptions

[7]Alibaba continues international expansion – adds two datacenters and a bank

[8]Higher spec machines lift US PC revenues 40% even as shipments drop

[9]Lenovo infrastructure group and Alibaba Cloud both make first annual profits

Automation capabilities were built into the factory, including a building management system Lenovo says will monitor temperature, humidity, and asset conditions.

In the current climate, Lenovo also has to look to environmental concerns, and so the new factory was fitted with solar panels capable of providing half a megawatt of energy, or enough to power the equivalent of a small village. Combined with new manufacturing processes, such as a patented low-temperature solder process, this will contribute toweard achieving climate goals, Lenovo claimed.

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Earlier this year, Lenovo reported the [11]first annual profits for its infrastructure group since buying IBM's X86 server business in 2014.

Lenovo reported quarterly revenue for Q4 of $16.7 billion, a 7 percent increase over the same quarter in the previous year, while annual revenue reached $71.6 billion, an increase of 18 percent and annual net income topped $2 billion. ®

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[1] https://regmedia.co.uk/2022/06/15/lenovo_euro_factory.jpg

[2] https://news.lenovo.com/pressroom/press-releases/lenovo-expands-global-manufacturing-portfolio-with-new-inhouse-manufacturing-facility-in-hungary/

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[6] https://www.theregister.com/2022/06/09/pc_sales_to_shrink/

[7] https://www.theregister.com/2022/06/08/alibaba_business_continues_international_expansion/

[8] https://www.theregister.com/2022/06/06/us_pcs_shipments/

[9] https://www.theregister.com/2022/05/27/alibaba_lenovo_q4_fy_2022/

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[11] https://www.theregister.com/2022/05/27/alibaba_lenovo_q4_fy_2022/

[12] https://whitepapers.theregister.com/