Market impact and perspectives of 3D printing technologies

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3D printing is one of the most promising and ground-breaking manufacturing technologies, and [McKinsey] and [Gartner] point to it as one of the top technologic strategies for 2015. 3D printing is a disruptive technology that will change how design, manufacturing and retailing are done around the word. Objects are built from a 3D computer model by means of the addition of successive layers of materials.

Gartner technology hype cycle. Source: Gartner.

Gartner technology hype cycle. Source: Gartner.

Industry analyst [Wohlers Associates] estimates that 3D printing is now a three billion dollar industry and growing rapidly. [McKinsey & Company] estimated that their global economic impact will be around 230 – 550 billion of USD. According to the The Wohlers Report, 2013 “The market for 3D printing in 2012, consisting of all products and services worldwide, grew 28.6% (CAGR) to $2.204 billion. This is up from $1.714 billion in 2011, when it grew 29.4%. Growth in 2010 was 24.1%. The average annual growth (CAGR) of the industry over the past 25 years is an impressive 25.4% including CAGR 2010 – 2012 of 27.4%”.

First printers targeted industry applications, but in the last years lots of domestic printers have appeared in the market. From another research by [Wohlers Associates], the growth of the low-cost (under $5,000) “personal” 3D printer market segment averaged a 346% each year from 2008 through 2011. In 2012, the increase cooled to 46.3%, but they believe it will continue with a strong double-digit growth in forthcoming years, creating a USD 10.8 billion worldwide market by 2021.

The economic implications are so strong because specific products can be designed and printed beyond the traditional mass production systems, affecting traditional logistics and supply chain paradigms. Although 3D printing can be applied to multiple industry domains, different impact depending on the sector is expected:

  • big impact on industries including consumer products and industrial manufacturing;
  • medium impact on construction, education, energy, government, medical products, military, retail, telecommunications, transportation and utilities;
  • low impact industries would include banking and financial services and insurance.

art10_3d_printing_McKinsey

Nowadays it is still a challenge for industries to integrate 3D printing technologies in their business. According to [PwC], two thirds of US industries are somehow introducing 3D printing in their environments, and more than 25% are convinced to commit to this technology in the short-run. [Cognizant] reports that 78% of the manufacturing industries expect 3D printing to disrupt their business processes. 94% of them see 3D printing as an opportunity rather than a threat with longer term impacts seen as quicker time to market (48%), cost savings (45%) and a greater flexibility to build a wider range of products (41%). For instance, some companies such as Airbus and General Electric are already using metal 3D printers to produce some complex metal parts for their products; the 2014 Wohlers Report marks 348 metal printers sold in 2013 compared to 198 in 2012, an impressive 75% growth.

Aftermarket sales and services can be a very promising domain to introduce 3D printing. Although they are estimated to be 75% more profitable than those of the core business [Cognizant 20-20 Insights], their associated costs are high: for most manufactured products, transportation is only 2-5% of total cost; in contrast, raw materials, components, and subassemblies typically constitute 55-75% of total cost [Inbound Logistics].

3D printing disruptive manufacturing applications hype. Source: Accenture.

3D printing disruptive manufacturing applications hype. Source: Accenture.

[Accenture] reports show that the 3D-printed spare parts production market will be in the hype in the next 5-10 years. According to [Cognizant-SAP Manufacturing Success 2014], 60% of manufacturers say that traditional supply chain issues have negatively impacted company revenues in the last year. International equipment manufacturers, such as UPS and Siemens, have already envisioned a paradigm shift to a Digital Supply Chain, embracing 3D printing as the most promising technology to enable this change [Gartner, McKinsey].

The technology is ready, now it is in our hands to foster its integration. The key is to find the right way to do it so we can match all industry expectations, or even go beyond them.

References

Accenture Technology – 3D printing’s disruptive potential (2014)

SAP & Cognizant – Manufacturing Success (2014)

McKinsey & Company – Disruptive technologies: Advances that will transform life, business, and the global economy (2013)

Wohlers Associates – The Wohlers Report (2014)

Wohlers Associates – The Wohlers Report (2013)

Cognizant – Cognizant 20-20 Ingishts, Spare Parts Pricing Optimization (2012)

Gartner – Emerging technologies hype cycle (2013)

PA Consulting – Restructuring global supply chain for cost savings – Twinings (2014)

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