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While awaiting the official data for 2017, which will arrive with the various spring reports, we can think about a set of expectations for 2018 which promises to be very interesting year for the 3D Printing market and with the Additive Manufacturing downstream activities.
The Wohlers Report, one of the most authoritative sources in terms of reporting and market forecasts for 3D Printing and Additive Manufacturing, outlined for 2016 a volume of 6.63 billion dollars in revenues, a number that confirms the general enthusiasm for this technology, also perceivable at the major industry events such as Formnext and Rapid TCT, which in 2017 also saw a marked increase in the number and quality of exhibitors.
If HP, thanks to its brand new Jet Fusion, was able to enter straight into the top five producers of industrial 3D printers, in 2016 it was joined by 35 new producers, over a third more than the previous year with 62 in 2015, 97 in 2016. (Source Wohlers)
Sure, the 6 billion dollars of revenue in 2016 are still far from the 24 billion forecast for 2025 (source Grand View Research), but the optimism is mainly generated by the incidences of percentage growth of +22% professional/industrial 3D printers, +45% desktop printers / prosumer; data referred to the first three quarters of 2017. (Source Context)
If we want to have a bit of fun talking about future projections, again with reference to 2025, said predictions would range from “only” 12 billion dollars as forecasted by Lux Research to 180 billion projected by McKinsey. How is this possible? Recently, on cue with a study ordered by Zortrax, Deloitte Poland executed a thorough analysis of published reports on 3D Printing, which shows a very wide forecast gap conditioned both by the different parameters used and by the wide variety of factors that can affect market trends over a decade. By filtering and interpreting the data collected, Deloitte offered a synthesis which takes into account the main aspects of the business of 3D printing, including general turnover, forecasts up to 2020 and the diffusion of the main printing technologies present on the market.
Another reason for optimism is the distinct feeling that we have permanently expelled the media sensationalism at the base of the speculations and false illusions that ran rampant until three years ago. It was all we were talking about, it seemed that we were to have a 3D printer in every home. To do what? Innovation meets commercial success only if it responds to the real needs of the market. History teaches us how stock market peaks related to technology trends are the result of speculation, rather than the result of solid investments. Their fragility is almost always translated into inevitable collapse. In addition to investors who fell for it, some manufacturers like Makerbot also paid the price and their numbers (approximately 90,000 printers sold in 2015, Ed.) were deemed unsuccessful in that they did not meet met the predictions that presented the consumer brand Stratasys as the forerunner of a technology able to enter into all homes. The same numbers would have been anything but disappointing if evaluated with other parameters. After the alleged boom, the media started talking about a crisis of 3D printing, while this sector, even taking into account the negative incidents we have mentioned, has never been in crisis as it has recorded steady growth every year.
The era of personal fabrication, of widespread 3D printing, most likely will come, but this is a totally different topic than the business of 3D printing related to manufacturing. They are two aspects that need to be clearly separated on a conceptual level and on the practical consequences that they entail. It was what, on the basis of the famous Hype Cycle analysis by Gartner, we said in the article 3D printing: is it time to get serious? A supposition from 2015 that, in hindsight, is more relevant than ever.
MANY NICE NUMBERS, BUT WHAT GOOD IS 3D PRINTING TODAY?
Emerging technologies instinctively generate curiosity in investors. We are tempted by the desire to create a competitive advantage by adopting a new technology. However, one needs to be convinced that investing in solutions of a certain type actually generates benefits for their business. Furthermore, what do you invest in? How do you navigate the hundreds of products and solutions available on the market? And most importantly, what are the applications where 3D printing is currently able to provide tangible benefits?
Thanks to a proprietary application based on artificial intelligence, Sculpteo has processed a very high amount of data to give a credible answer to these questions. From what emerges in the 2017 annual report by the French service, 34% of investments in 3D Printing concerned prototyping and 23% the concept phase. These numbers add up to nearly 57% of the total and confirm the maturity of this technology in the design stage, with the goal of speeding up development (28%), customizing the product (16%) and increasing the flexibility of production (13%). The percentage linked to production (22%) is a laggard though it is growing. The market share destined to 3D printing in the marketing sector (10%) is also very interesting, due to its great flexibility in the production of limited editions.
Another interesting interpretation is the attempt to predict the reasons that will encourage investment in 3D printing five years from now. An analysis that yields numbers substantially very similar to the current ones. The growth of factors connected with manufacturing is there, but it reflects the slow and gradual trend that characterizes the investment stability that is typical of the industrial sectors.
METAL 3D PRINTING
A manufacturing technology cannot be independent from materials. Those working in the industrial sector are fundamentally interested in the 3D printing of metals, to the torment and delight of Additive Manufacturing. Also in this case, the figures appear quite encouraging. The American analyst Smartech confirms this in a report that fixes the revenue of 3D printing linked to metal powders at 950 million dollars. The value is equivalent to about one-sixth of the total estimated volume for the entire 3D Printing Market.
According to an accurate forecast model, Smartech expects that Metal 3D Printing might generate revenues upwards of 6.6 billion dollars in 2016, thus confirming its position as one of the technology areas with higher margins of potential growth. From the point of view of motivations, Sculpteo identifies the 3D printing of metals as a problem solver for the design of complex shapes impossible to obtain with traditional processes (16%), for reducing cost (11%) and for a great flexibility in the production of limited editions (9%). Aluminium (62%) stands out as the most used metal, followed by steel (22%) and titanium (8%). Precious metals are further behind, confirming once again how the jewelry sector is currently using Metal 3D Printing technologies primarily for tooling and for the manufacture of molds, rather than for the creation of the final product.
Further guarantees of future growth derive from the overall volume of investment in this area. In 2016 General Electric entered the market decisively with the acquisition of the two metal additive production specialists Arcam (Sweden) and Concept Laser (Germany), acquired for a total of around 1.4 billion dollars. These are two fundamental additions for the division GE Additive, with which the American giant intends to position itself on the European market. The opening of the Customer Experience Center in Munich, which follows a similar initiative undertaken by EOS, the world’s other leading producer of Metal 3D Printing, must be interpreted in this light.
If progress in printing technologies and materials will create the conditions necessary to substitute traditional processes, implementing the benefits of Additive Manufacturing within companies will increasingly become a matter of expertise. Consultancy on 3D Printing is an essential starting point for a company to evaluate and assess the effectiveness of an investment. Currently an informed answer must be derived from a case-by-case assessment of the needs and objectives related to design, prototyping and production of a product.
Sources: Wohlers, Forbes, Grand View Research, Context, Canalys, Smartech, Sculpteo Investing News, General Electric, Concept Laser, Zortrax.
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