Increasingly Additive Manufacturing or 3D printing has become a hot news feature in the scientific or technical press and television news proclaiming revolutionary techniques to create products as diverse as jewellery, curvy concrete walls or car dashboards and even human spare parts. Pioneering medical applications include replacement jawbones and ears using powdered titanium or actual human tissue. The technology commonly uses resins, plastic pellets or powered metals or liquids to print a product using a specially adapted printer applying layer by layer the material through a nozzle or fusing by heat from a laser with a design created by CAD 3D software transferred to the printing device. The technology has been around for more than 20 years already and has been used by engineering companies such as GKN or Rolls Royce for parts in aeroplanes and automobiles. The internet was similarly available to academics and researchers before the worldwide web transformed its use.
If the hype is to be believed (along with Synthetic Biology) the emerging technology is set for great acclaim as the century develops. The business network LinkedIn already has many groups all discussing the various applications for 3D printing. Academics, consultants or printing companies and other gurus are available to help you create your product using their research and expert advice, software and manufacturing technique or device for a fee or unit price.
Historically revolutionary technology has a long pedigree of causing great societal change for example the c.19th century railways boom or the development of internal combustion engine accompanied with the growth of companies such as Mercedes-Benz or Shell. More recently the 1980s brought personal computing with Microsoft still a giant in the operating software industry and Intel in microprocessors. The internet and mobile communication explosion from the 1990s onwards brought forth Vodafone, then Google and now Facebook not withstanding c.19th stalwarts AT&T and General Electric still in the frame. 3D printing is being presented as such a technology to revolutionise the way products are manufactured everywhere by anyone with a suitable 3D printer capable of producing the product from anywhere in the world using broadband telecommunications. Supply chains will be shredded and transport costs and subsequent pollution dramatically reduced.
Will it increase or decrease global GDP? The implications are enormous regarding the winners and losers with vested interests such as contract manufacturers, trade unions or professions, an array of regulators, and transport and packaging companies who may see their business or function diminish and even disappear or certainly impeded by the personalisation of the manufacturing process. Furthermore, traditional industries may fear the loss of skills through technological replacement a story echoing back to the weavers of the 1st industrial revolutions rioting over the introduction of the Spinning Jenny. In previous industrial revolutions occupations and organisations rise and fall as the new technology develops with better techniques and new applications. This brings new markets and hopefully a general increase in the standard of living.
Every investor wishes to invest in the equivalent of a Shell or General Electric in 1900, Microsoft in 1978 or Cisco, Intel and of course Google in last decade which have all grown massively and survived busts including latterly the 2007-2009 financial crisis. However this is easier said than done. Politics and the scheming of vested interests may check or alter the use and development of the technology through protective trade policies and legislation masquerading in the form of health and safety measures or fire regulations or other politically sensitive trade issues. Another good reason for the difficulty against picking early winners is that the present incumbents may simply not withstand the changes that occur with 3D printing over the next 5-10 years in its application or designated markets. Existing companies that adopt additive manufacturing into their processes gradually may be able to defend their market share from start-ups. Similar happened with 1990s-2000 internet start-ups against the incumbents in media, entertainment and leisure industries.
The companies currently considered leaders of the pack in 3D printing are unsurprisingly US companies such as 3D Systems and Autodesk providers of printing equipment and software. Both are quoted and easily found by searching on Google, FT.com, and Moneyweek magazine. Personally, I don’t think they are cheap as their shares are trading on a high multiple of sales never mind earnings along with other 3D hyped shares. The FED policy driven market rally will eventually tire when the Fed begins tapering its QE programme so perhaps a buying opportunity later.
The amount of new employment opportunities to be created by the next touted industrial revolution remains to be seen as does their nature and worth. However for some professions should survive for example you can’t print yourself a new liver or lungs from fresh stem cells without a competent surgeon to transplant them into you.
Finally, police raids recently took place in Manchester, UK on the first 3D printed gun making factory. Long predicted but what will the Government reaction be- a 3D printing restrictive practices bill or compulsory registration of 3D printers with local police similar to shot guns?
How the next Industrial revolution plays out in the coming years is well worth watching.
LDC