Additive Manufacturing - Gimmick to Game-Changer

Transcript

In October 2012, Wired editor-in-chief Chris Anderson published his book, Makers: The New Industrial Revolution. In the book, he boldly predicted that 3D printers would follow the path of PCs and become a fixture in every home.

This would lead to a future in which everyone routinely printed out whatever they might need, from a collar for the family pet, to a replacement for a broken part on the washing machine, to tiny furniture for the children's dollhouse.

Beyond that, he predicted that everyday consumers would become product designers, uploading blueprints to websites where others would pay a small fee to download them.

Or as Anderson put it, "the collective potential of a million garage tinkerers and enthusiasts is about to be unleashed upon the economy, driving a new age of American manufacturing."

A few months after the book's publication, we warned you that only the second half of that quote would turn out to be true. While a majority bought into Anderson's vision of the "maker revolution," we spelled out the reasons that it was likely to fizzle out. However, Anderson was correct in imagining "a new age of American manufacturing."

It's just that most of the manufacturers won't be individual consumers toiling away in their garages, basements, and living rooms. Instead, there will be traditional manufacturers that are savvy enough to see the potential of the new technology, as well as innovative startups that will be built from the ground up as 3D manufacturers.

So where does this technology stand today? A good place to begin is with the "Gartner Hype Cycle," which plots new technologies against the predictable phases they go through. Consumers' adoption of 3D printer for home use is the application that is currently the farthest from becoming a reality.

According to industry blog ALL3DP (for "all about 3D printing"), That consumer 3D printing is far away, makes sense since the technology needs to become much faster [and more] reliable, and materials science needs to advance significantly.

By contrast, the 3D printing applications that are advancing the fastest are rapid prototyping, industrial 3D scanning, 3D modeling software for physical parts, and 3D printing of medical products, such as dental devices and hearing aids.

In fact, according to the Harvard Business Review, 3D printers now custom-produce most of the hearing aids in the U.S., car manufacturers are using them to make vehicle parts, and the FDA has approved 3D printing for the manufacturing of pills.

Meanwhile, according to USA Today, HP has just introduced what it calls the first 3D printer for large-scale manufacturing. Nine manufacturers are testing the HP Multi Jet Fusion 3D Printing Solution, which offers a ten-fold increase in speed over previous printers.

For example, Nike plans to use it for on-demand printing of athletic shoes in multiple designs, while BMW intends to print parts that will allow cars to be customized for individual buyers.

The printers aren't cheap: They start at $130,000, and the price increases to $155,000 when software is included.

3D printing is booming now because patents are expiring on industrial printing processes that until now had kept startups from entering the market. According to a recent TechCrunch post, "when the fused deposition modeling (FDM) printing process patent expired in 2009, prices for FDM printers dropped from over $10,000 to less than $1,000, and a new crop of consumer- friendly 3D printer manufacturers, like MakerBot and Ultimaker, paved the way for accessible 3D printing.

The next generation of additive manufacturing technologies are making their way down from the industrial market to desktops of consumers and retailers much like FDM did." One of those 3D printing technologies is called liquid-based printing, which is widely viewed as the premiere process for printing precision parts.

The liquid-based stereolithography (SLA) process points an ultraviolet laser at a vat of liquid resin in order to deposit thin layers until the product takes shape. Instead of using liquid, the selective laser sintering (SLS) process uses a powder in the printing process. The laser gradually builds up the product one layer at a time, with each new layer sintered on top of the previous one.

Direct metal laser sintering and selective laser melting both use metal as the material, instead of powder or liquid. The benefits are obvious, as products or components made of metal are sturdier than those made of resin, and these processes are being used to make parts for race cars and rockets.

Patents for each of these three types of processes have either recently expired or will expire this year, opening the floodgates for competitors to introduce printers at much lower costs.

Among the benefits of 3D printing are:

Virtually zero waste: Because products are made one layer at a time, rather than milled from a block of material, there are no scraps.

Innovation: 3D printing makes it possible to create products that didn't exist before, and it enables rapid prototyping of new designs.

Customization: Unlike mass production, 3D-printed products can be tailored to each individual.

Speed: Instead of taking weeks to set up an assembly line, 3D manufacturers can print a product in the same day the design is finalized on a computer.

Localization: Rather than printing products in one place and shipping them to another, 3D printing makes it possible to manufacture a product wherever it will be used, eliminating the costs and delays involved in distribution.

When products can be printed on demand, inventory can be sharply reduced. Clearly, 3D manufacturing offers the potential to disrupt existing industries and to open up new opportunities.

With that in mind, the Harvard Business Review recommends that executives address the threats and opportunities of 3D printing by answering the following questions:

What would be the cost/benefit of flattening your supply chain and moving production closer to your markets?

How could digital printing improve your innovation, product development, and speed to market?

How could digital printing and its promise of mass customization change your relationships with customers?

Are there entirely new lines of business that your company could only execute in a 3D world?

Are there operations you would shed?

How could 3D-printing upstarts exploit the benefits of speed, cost, and customization to compete against you?

How will you protect your IP from piracy or other loss of value?

Could your brand face quality erosion or other damage as your designs are distributed and modified in a shared economy model?

Looking ahead, we foresee the following developments emerging from this crucial trend:

First, the market for 3D printing at the enterprise level will explode, while consumer adoption of the technology will be more muted. According to a survey of 900 supply-chain managers by MHI and Deloitte, 14 percent of their companies currently use the technology, but nearly half expect to adopt the technology within the next decade.

Gartner projects world-wide sales of 3D printers will reach almost $4 billion next year; that's a 1,000 percent increase from $406 million in 2012. Terry Wohlers, president of market researcher Wohlers & Associates, predicts that the market will grow to $640 billion if it replaces just 5 percent of the goods that are mass-produced in today's $12.8 trillion manufacturing economy.

For most consumers, however, the costs of individual ownership are still too high, and the applications are still too few, to justify printing products at home.

Second, 3D printing will not replace large-scale manufacturing in the foreseeable future. Economies of scale of installed mass-production systems, such as those in Chinese factories, can churn out millions of identical products at a low cost that 3D printers can't match.

The benefit of 3D printing will be that it will allow companies to produce specialized parts in small quantities, as well as custom orders, that would be too expensive under a mass production model.

Third, companies that use 3D printing to manufacture products will face a tangle of tax issues. What happens when a company designs a product in one country, but the product is printed out by another company, or by a consumer, in another country?

Will countries tax blueprints, or the materials that are used to print out the designs? These and many other tax and customs issues will need to be sorted out.

Fourth, competition among 3D printing companies will intensify as new players, business models, and processes enter the field.

Today the market is led by Stratasys, which captured 41 percent of worldwide market share for industrial 3D printers priced over $5,000 last year, followed by 3D Systems, at 15 percent, and Envisiontec at 10 percent. Other notable companies are Mcor, at 6 percent, and EOS, at 3 percent.

But, as patents on old processes expire and new processes are invented, the competition is heating up. As discussed earlier, HP is moving aggressively into the market.

Among the other innovative 3D printing companies to watch, according to All3DP, are:

Formlabs, the first 3D printer company to bring stereolithographic printing to a mass market.

Shapeways, which dominates the market for business-to-consumer 3D printing of designs purchased online and printed to order.

3D Hubs, which enables consumers to purchase 3D printing services from other consumers.

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