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Four areas where 3-D printing could flourish

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More than most modern technologies, the 3-D printer resembles something seen in Star Trek: out from an empty box come insoles for shoes, hearing aids, precisely tooled jet engine parts, a filet mignon, and even, one day, human organs for transplant.

Such possibility has prompted a swell of optimism: Business Insider in 2014 explained How 3-D Printing Will Revolutionize Our World, and a Forbes headline the following year asserted 3-D Printing Is About To Change The World Forever.

But as with any buzzed-about technology, distinguishing genuine potential from the hype is complicated. New research by Supesh Jain and Tafadzwa Magaya, both recent graduates of the MIT Sloan Fellows program, outlines conditions that make markets most receptive to the widespread adoption of 3-D printing. Understanding these conditions, Jain and Magaya hope, can help investors and businesses evaluate whether a potential application is worthwhile.

“I’m very bullish about the future of 3-D printing as it pertains to manufacturing,” said Magaya. “I think it’s big-time.”

But some of the expectations, he noted, have far outpaced reality.

“Most people perceived 3-D printing as everyone owning a unit at home and printing socks, and that’s never going to happen,” he said. “That’s where industry got lost: waiting for the mass-market application.”

So what should companies and investors interested in 3-D printing look for?

Customers who want customization

Traditional manufacturing facilities require large outlays of capital and are generally designed with a fixed set of products in mind; their profitability comes from economies of scale. Retooling a manufacturing line is thus expensive.

Ford, for instance, spent $359 million and shut down its Dearborn, Michigan plant for 13 weeks to accommodate a new frame for its F-150 pickup truck. This relative inflexibility in traditional manufacturing makes 3-D printing ideal for the production of custom products.

Designing prosthetics, for example, demands customization for every customer. Founded in 2013, Cyborg Beast paired digital modeling software with 3-D printing to create a prosthetic hand for as little as $50, while conventional prosthetic hands generally cost between $30,000 and $40,000. Any market similar to this one, where customization rules, is ripe for disruption by 3-D printers.

Long-tail manufacturing

The New York City Transit Authority, one of the world’s largest and most heavily trafficked subway systems, was largely built in the 1930s. Old vendors no longer exist; replacement parts are impossible to find. The MTA refurbishes and machines components on its own.

Markets like this that express high variability and infrequent, low demand — vintage car collection is another example — cannot be effectively served by traditional manufacturing. It would simply be too expensive for the MTA to contract services out. 3-D printing readily solves the challenge of manufacturing rare replacement parts, while also overcoming the obstacle of distribution: a plant exists wherever a printer does.

“3-D printing allows you to design and make parts in a way that is simply unavailable with traditional manufacturing methods,” Magaya said.

End-to-end control

In a number of industries, like jet engine manufacturing, companies are fully integrated across the supply chain, from procurement to assembly. Because this control allows a comprehensive view all manufacturing processes, it also provides insight into where small design tweaks, affordable through 3-D printing, might produce efficiencies.

General Electric’s Leap engine is one of the highest profile cases of this: the new jet engine, which incorporates 3-D-printed parts and is far more efficient, is expected to save $1.6 million in fuel costs per airline per year. Given the promise of this first serious foray into 3-D printing, GE has created GE Additive, a new business division with an investment of more than $1 billion dedicated to 3-D printing.

Incidentally, printing for the Leap engine was also able to extend the product’s competitive lifetime in the marketplace.

“The 3-D printed parts were able to help achieve fuel efficiencies that would have otherwise required an improvement in the core technology,” Magaya said.

While Magaya and Jain note that companies needn’t necessarily have end-to-end market participation to adopt 3-D printing, they do believe that these fully integrated companies will lead the widespread adoption of 3-D printing in particular cases, like when products are unusually complex, or made of materials other than those in traditional manufacturing.

Making the unmakeable

Finally, there are certain applications for which 3-D printing enables manufacturing of parts that would otherwise be too expensive, or even impossible, to manufacture. Take bio-printing of human organs: a handful of companies now print human tissue that can be used for toxicity and pharmaceutical testing. Other companies are using 3-D printers to make meat in attempts to replace the factory farming system.

This unorthodox application of 3-D printers could produce an interesting side benefit of substantial value.

“Growing political will and pressure to develop manufacturing jobs nationally, coupled with 3-D printing's ability to redefine conventional blue collar jobs into a creative, high-tech endeavor, may attract the millennial workforce back into the manufacturing industry,” write Magaya and Jain.

For more info Zach Church Editorial & Digital Media Director (617) 324-0804