3D Printing: The Next Revolution

in Industrial Manufacturing

NEW RESEARCH FROM UPS AND THE CONSUMER

TECHNOLOGY ASSOCIATION (CTA)
 3D PRINTING VS.
MARKET EXPERT INDUSTRY CASE WHATS NEXT IN
INTRODUCTION TRADITIONAL
COMPOSITION PERSPECTIVES STUDIES 3D PRINTING
MANUFACTURING

INTRODUCTION

3D printing: An overnight success?

The technology for 3D printing has roots that go back decades. The minds behind it
were visionary. But for many years, 3D printing appeared at least in the mainstream
view to be more of a novelty than a practical tool to advance commercial
manufacturing. 3D printers created one-off trinkets, souvenirs and not much else.
And business leaders often were skeptical that 3D printing would ever advance enough
to be an integral part of manufacturing.

Nevertheless, we are now seeing that 3D printing has reached an inflection point
as lower costs and technological advances have put it within reach of more people.
Thats the most common use because it allows for a more agile design process and
rapid product iterations. Some of the more progressive users are exploring larger-scale
parts production for existing products. Meanwhile, we at UPS are taking a closer look
at 3D printing as a complement to our supply chain and logistics business. Weve long
recognized the disruptive potential of 3D printing, and we intend to help the customer
supply chain stay ahead of the curve.

UPS recently partnered with the Consumer Technology Association (CTA) to conduct
in-depth interviews with U.S. companies that are early or recent adopters of 3D printing.
We wanted to learn more about the factors that influence the adoption of 3D printing. This
study also compiles published research and forecasts from thought leaders and analysts.

Our conclusion: 3D printing presents compelling business opportunities. Companies that

wait too long to explore the potential could be missing out.

UPS is proud to present this study, which offers valuable insights into the current and
future trends for industrial 3D printing.

Derrick Johnson
Vice President of Marketing at UPS

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MARKET COMPOSITION 3D Printing is a Multi-Billion Dollar Market and Growing

3D printing: A $21B
$7.3 billion market
$13B
Researchers estimate that the 3D printing market will
reach $7.3 billion in 2016. The primary market including
$6B $7B
3D printing systems, materials, supplies and service has
grown at least 30% each year from 2012 to 2014. The rest
$4B
of the growth comes from the secondary market, including
tooling, molding and castings. 2013 2014 2016 2018 2020

Western countries (North America and Europe) account

for more than two-thirds (68%) of the 3D printing market
revenue and Asia Pacific accounts for 27%.
3D Printing Market Revenue by Geography
The consumer electronics and automotive industries each
contribute 20% of the total 3D printing revenue. These
early-adopter industries use the technology primarily

40%
during the prototyping stage of production. For example, North
smartphone manufacturers are slowly using 3D printing for America
more than just prototypingsome component parts are now
manufactured with 3D methods. 28% Europe
The medical device industry (15%) is the third largest 3D
printing market and uses 3D printing for mass customized
finished goods such as hearing aids. 27% Asia/Pacific

Interesting fact: 98% of hearing aids worldwide are

manufactured using 3D printing.
The U.S. hearing aid industry converted to
~100% 3D printing in less than 500 days.

SOURCE: Wohlers Report 2015: 3D Printing and Additive Manufacturing State of the
Industry Annual Worldwide Progress Report, Wohlers Associates, 2015. PAGE 3
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MARKET COMPOSITION

Top Uses for 3D-Printed Goods

Manufacturing, a market
ripe for disruption 18% 10%
Fit and finish
Despite significant growth, there is a wealth of untapped components Molds and
potential in 3D printing. In fact, 3D printing represents tooling

29%
only 0.04% of the global manufacturing market, with
prototyping as the leading use today. Wohlers and
Associates believes 3D printing will eventually capture 5%
Functional

10%
of the global manufacturing capacity, which would make
3D printing a $640 billion industry. parts

Much of the opportunity lies in parts production the Visual proof

fastest-growing 3D printing application. The use of 3D
of concept
printing for parts production grew from virtually zero in
2003 to 43% ($1.8B) of global 3D-printed product and
service revenue in 2014.

3D-printed parts are currently being used most for

functional parts (29%), prototypes (18%) and visual
aids (10%).

This is a market ripe for disruption. Technology adopters

that move beyond prototyping to use 3D printing in
supporting and streamlining production can achieve new
manufacturing efficiencies. Plus, there is an enormous
opportunity for companies that get it right.

In 2015, 3D-printed manufactured goods represented

less than 1% of all manufactured products in the U.S.

SOURCE: Wohlers Report 2015: 3D Printing and Additive Manufacturing State of the
Industry Annual Worldwide Progress Report, Wohlers Associates, 2015. PAGE 4
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3D PRINTING VS. TRADITIONAL MANUFACTURING Top Reasons to Pursue 3D Printing

25%
Prototyping

Technology trade-offs 16%

3D printing is not a one-size-fits-all solution. For
9% Product
Cost reduction development
high volume, standardized applications, traditional
manufacturing is likely the answer.

When is 3D printing the answer? The top reasons for

pursuing 3D printing are: 10% 11%
Increased Innovation
prototyping (25%), efficiency
product development (16%), and
innovation (11%)
3D Printing vs. Traditional Manufacturing
3D printing can speed development and delivery for
customized products and bring increased flexibility through
better inventory management and real-time production VOLUME COST TIME TO COST OF
PER UNIT MARKET COMPLEXITY
of products with variable demand. Other advantages
include manufacturing advantages for small batches, cost
advantages based on efficiencies for certain applications Small batch, High variable costs, Very fast No higher than
and unprecedented flexibility in new markets. Highly customized No fixed costs ( 1 day) simple parts

3D printing also can improve quality through lighter 3D PRINTING

parts, better ergonomics and more design freedom.
However, low process stability can negatively impact
quality; and low reproducibility can negatively impact Large batch, Low variable costs, Very slow to Much higher than
product durability. Not customized High fixed costs moderately slow simple parts

TRADITIONAL
Its critical to consider needs and priorities to make
the decision between 3D printing and traditional
manufacturing. Like everything else, there are benefits
and trade-offs. 3D printing is displacing some traditional manufacturing methods
such as metal extrusion, computer-controlled machining and manual
modeling techniques for prototype development manufacturing.

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EXPERT PERSPECTIVES
3D Printer Intenders vs. Current Users

3D printing adoption CURRENT USER INTENDER

Current Users:
Two thirds of manufacturers already use 3D printing in
some way, and 25% plan to adopt the technology in the
future. Despite these numbers, the full potential of 3D
printing is far from tapped.

Intenders: Believe that manufacturing service providers

Thirty-two percent of current users dont believe their
50%
will play an increasingly important role in the
company is fully leveraging the advantages of 3D printing future of manufacturing 61%
while 45% of intenders would use the technology more if
benefits were better understood by their company.
Have already started to rethink 40%
product design to better leverage 3DP
Influencers:
design capabilities 28%
The primary influencers driving companies 3D printing
strategy are managers in R&D, engineering and or
manufacturing. Demonstrating the benefits of 3D printing Are now doing more 3DP in-house that 40%
to these audiences is crucial for driving increased adoption. used to be outsourced in the past 7%

Do not believe company is fully 32%

leveraging the advantages of 3DP 49%

Would use 3DP more if company better 25%

understood the benefits
45%

SOURCE: Trend Forecast: 3D Printings Imminent Impact on Manufacturing, Stratasys

Direct Manufacturing, 2015, https://www.stratasysdirect.com/content/pdfs/
sys_trend-forecast_v10.pdf. PAGE 6
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EXPERT PERSPECTIVES
3D Printing Tackles Supply Chain Challenges

Supply chain impacts

3D printing has the potential to shake up supply chains by
positively impacting parts manufacturing, inventory costs
and lead times.
Parts sole-sourced
For example, 3D printing can help companies meet
from suppliers
demand in real time in situations when long lead times
are a problem. It also can help lower inventory costs by High inventory Remote
enabling companies to maintain a virtual inventory and costs locations
print parts as they need them.

3D printing can be used in centralized* and decentralized**

networks; however, research has shown that using 3D
printing in decentralized networks has a measurable Long High import/
impact on the supply chain. lead time export costs

Parts are expensive Limited

to manufacture functionality

*Centralized networks: Manufacturing at a single location or through a chain of single

locations, focused on production efficiency.

**Decentralized networks: Production is spread out and closer to the consumer. PAGE 7
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INDUSTRY CASE STUDIES Three Real-Life Examples of Consumer

Electronics Companies Using 3D Printing

Consumer electronics
Present Applications
3D printing has generated positive results for the consumer
electronics industry through prototype development, new LARGE CONSUMER LARGE COMPUTER SMALL CONSUMER
product and concept designs, and parts prototyping. ELECTRONICS COMPANY ACCESSORIES COMPANY AUDIO/HEADPHONES
COMPANY
For example, a large consumer electronics company
reduced design validation times from one week to one day, LEVEL Early adopter Established user Recent adopter
significantly improved fit and finish, and created better
products through 3D printing. A large computer accessories
company saw a return on its initial investment in just eight Prototype development
months of 3D printing use. A small consumer audio company Prototyping parts
PROTOTYPING New product & concept Customized assembly
experienced improved processes and workflow by using 3D design
USES Prototyping models components
printing for customized assembly components.
Show models
Future Applications
The next big 3D printing opportunity for the consumer Custom tooling
electronics industry is in smartphones, which comprise OTHER Miscellaneous hardware
an estimated 35% of total consumer electronics sales. MANUFACTURING Evaluating high volume Not reported
Smartphone manufacturers are slowly moving beyond USES production Manufacturing
prototyping applications for 3D printing with more growth
projected in the near future after advancements in materials Reduced prototype
and equipment. turnaround times by at least
several hundred percent Company saw return
on initial investment in Enabled customization
Our prototype turnaround time reduced from Reduced design validation 8 months, and again in
3-6 months to 2-3 weeks. Time-to-market for OUTCOME times from one week to 18 months Improved process &
new products reduced by 40-60%. 3D printing one day workflow
is viewed as an enabler here for expanding into New manufacturing tool
Fit & finish improved
new markets. We initially used it once a week significantly
but now its used daily. The whole organization
understands the value. Better products created
- Engineer/senior industrial designer at a consumer electronics company
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INDUSTRY CASE STUDIES Two Real-Life Examples of Automotive

Companies Using 3D Printing

Automotive
Present Applications
The automotive industry invested early once 3D printing
became commercially available. Today, automotive LARGE AUTOMOTIVE MEDIUM AUTOMOTIVE
manufacturers primarily use the technology for CLIMATE CONTROL ENGINE CONTROL
prototyping rather than parts manufacturing. This is likely COMPANY COMPANY
because automotive production volumes are usually too
high for 3D printing to be a viable manufacturing method LEVEL Early adopter Recent adopter
for most finished parts.

3D printing users in the industry have experienced Product concept prototypes 3D printed sand cores for
measurable benefits. A medium-sized automotive engine casting of prototypes
PROTOTYPING Pre-production prototypes
control company used 3D-printed sand cores for the Plastic prototypes
USES
casting of prototypes and saw prototyping time diminish Show models for other types of
from 16 weeks to one week or less. components

A large automotive supplier used 3D printing for product Assembly fixture

concept prototypes, pre-production prototypes and
show models. Automotive companies also experienced OTHER Test fixtures Evaluate new tooling
improved product cycle times by experimenting with MANUFACTURING for assembly process
3D printing for assembly fixture, test fixtures and robotic USES End of arm robotic tooling improvements
arm tooling. Misc. parts (screws, nuts, etc.)

Future Applications
Making parts cheaper, lighter and faster is often a Cut prototyping time by 94%
key goal of the automotive industry, indicating future
opportunities for 3D printing in parts manufacturing. Improved product Increased revenue by a factor of 10
OUTCOME cycle times
3DP plastics led to reduced
prototype turnaround time from
2 months to 2 days

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WHATS NEXT IN 3D PRINTING

Future Trends in 3D Printing

Technology advances
on the horizon
Faster Equipment Speeds
The future is bright for 3D printing applications across Faster equipment New and enhanced Advanced printing Additional
the supply chain. In fact, the average 3D printer speeds materials technology capabilities
production speed is expected to increase by 88%
by 2023. And, as printer speed increases, volume
capabilities also are likely to increase.
3D-Printed Materials Respondents
New and Enhanced Materials Want to See in the Future
New combinations of 3D printing materials, as well as
improvements to existing materials, will not only enable
unprecedented 3D printing applications, but also will 84%
help reduce prices. There will be an emphasis in metals
that is likely to grow over the next three years.

Respondents to a 2015 Stratasys survey report that 61% 60%

metal 3D printing is expected to grow faster than plastic. 52%
42%
Eighty-four percent of respondents reported they would
like to see further development with metal in the future
compared to 60% with plastic.

Advanced Printing Technology

and Additional Capabilities
Advancements in printing technologies and capabilities
also will spur the development of new equipment and
applications, like 3D-printed electronics.

Metals Rubber-like High- Carbon Conductive-

materials temperature fiber filled/circuitry
plastic
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