Economic Consequences of 3D Printing

Seminar Paper, 2014

27 Pages, Grade: 1.7

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Table of content

Table of figures

Table of tables

Table of abbreviations

1 Introduction
1.1 Relevance
1.2 Objective and structure
1.3 History of additive manufacturing
1.4 Types of 3D printing technologies
1.4.1 Fused deposition modeling
1.4.2 Selective laser sintering method
1.4.3 Stereolithiography

2 Current and future potential of additive manufacturing
2.1 Recent development of 3D printing industry
2.2 Benefits of 3D printing in comparison to traditional manufacturing
2.3 Application of 3D printing in various industries
2.3.1 Additive manufacturing in food industry
2.3.2 Bioprinting
2.3.3 Printing prosthetics
2.3.4 Additive manufacturing in military forces
2.3.5 Printing houses

3 Prospect of additive manufacturing in the near future
3.1 Opportunities and challenges of 3D printing
3.2 Pricing of 3D printers
3.3 Additive manufacturing as a mainstream technology

4 Conclusion
4.1 Results
4.2 Limitations


Reference list

Table of figures

Figure 1: History of 3D printing

Figure 2: Fused deposition modeling technology

Figure 3: Selective laser sintering technology

Figure 4: Stereolithograhpy in additive manufacturing

Figure 5: 3D printing industry value ($ billion)

Figure 6: Number of commercial 3D printing machines worldwide

Figure 7: 3D printing revenues by end market (2012)

Figure 8: Price developments of 3D printers compared to that of other technologies

Figure 9: 3D printing potential evolution compared to that of other technologies

Table of tables

Table 1: Global opportunities in 3D printing 8

Table of abbreviations

illustration not visible in this excerpt

1 Introduction

1.1 Relevance

3D printing or additive manufacturing is a “process for making a physical object from a three-dimensional digital model, typically by laying down many successive thin layers of a material” (Oxford Dictionaries, n.d). The first 3D printer was built in 1984. Thirty years from the first appliance of 3D printing the technology has substantially developed and is now used in various areas from medicine to military.

Today 3D printing is one of the fastest developing technologies, which has already triggered new developments in the economy and the whole society. Additive manufacturing is likely to change the whole manufacturing industry and also change the way people see producing goods. Printing everything, from food and toys to cars and guns at home might become possible in the nearest future. The conventional supply chain consisting of many steps will be substantially affected thanks to possibility to print everything locally.

Additive manufacturing will not only affect global economy but also have a positive effect on the environment thanks to almost zero amount of by-products and reduced need for transportation and as result CO2 emissions.

By 2025 additive manufacturing could have an impact on 320 million workers in manufacturing or 12% of the total global workforce. 3D printing will also likely affect the whole manufacturing industry valued at $11 trillion (McKinsey, 2013).

Clearly, 3D printing is a disruptive innovation such as once were internet, personal computers and mobile phones and this new technology is likely to have a great impact on the world and society in the coming decade.

1.2 Objective and structure

The aim of this paper is to explain the process of additive manufacturing, understand what the benefits of 3D printing are and what economic consequences it will have and finally analyze the prospect of 3D printing to become the mainstream technology.

The paper consists of four parts. The first part is the introduction, which provides an overview of 3D printing, history of its development and types of used technologies. The second part illustrates the benefits of 3D printing over traditional manufacturing and explains how this technology might change various industries. The third part analyzes the prospect of additive manufacturing becoming the mainstream technology. The fourth part provides a conclusion and describes limitations.

1.3 History of additive manufacturing

Charles Hull invented the process of 3D printing or additive manufacturing in 1984 (3D Innovations, 2012). For thirty years since its invention, 3D printing has been constantly developing and improving. The brightest developments so far have been the creation of prosthetic leg and the blood vessel in 2000s and the creation of fully printed car and aircraft in 2010s. However, only in the beginning of the 2010s the industry of 3D printing has started growing rapidly with a current CAGR of 34.9% (Anderson, 2014).

The figure below provides the timeline of the key developments in additive manufacturing starting from its creation in 1984 up to the present moment.

illustration not visible in this excerpt

Fig. 1: History of 3D printing

Source: Own illustration, following T. Rowe Price (n.d.)

1.4 Types of 3D printing technologies

When talking about additive manufacturing, most people imagine a printer, where a moving platform adds material layer by layer to build a final product. However, the method described, also known as fused deposition modeling (FDM) is not the only kind of 3D printing technology. In fact, there are many different additive manufacturing technologies, but the most often used are: fused deposition modeling (FDM), selective laser sintering (SLS) and stereolithograhpy (SLA).

1.4.1 Fused deposition modeling

FDM method implies manufacturing products by adding thin layers of liquid material, which almost instantly hardens. Once the first layer is made, the feeder with liquid material moves up to make the next layer.

Fig. 2: Fused deposition modeling technology

illustration not visible in this excerpt

Source: Own illustration, following University of Northern Iowa (n.d.)

FDM method has its advantages and disadvantages (3D-print blogspot, 2008). The main advantages of the FDM method are many materials available for printing, low maintenance costs, easy material change and compact size. The main disadvantages are visible lines between layers, longer build times and possible delamination because of temperature changes.

If FDM method is quite straight forward, SLS and SLA are a little bit more complicated.

1.4.2 Selective laser sintering method

SLS (selective laser sintering) printers use a laser to heat and fuse together the underlying printing material, be it glass, plastic or ceramic powder (HubPages, 2014). The laser heats required area of the material to fuse it. After this is done, a feed roller adds another layer of material, whereas the platform with the product moves down for a fraction of millimeter. The process of SLS printing is shown in figure 3. Fig. 3: Selective laser sintering technology

illustration not visible in this excerpt

Source: Own illustration, following University of Northern Iowa (n.d.)

Unlike SLA method, which can only use liquid polymers to manufacture products, SLS method can use a wide range of materials. Moreover, SLS method has an advantage against FDM method in terms of preciseness, as it allows a five times lower layer thickness (Buy 3D Printer, 2014).

1.4.3 Stereolithiography

The third most commonly used additive manufacturing technology is stereolithograhpy (SLA). This method is similar to the previously described SLS. The difference is that selective laser sintering only allows using polymers as the underlying component and that all the necessary material is available from the beginning.

Fig. 4: Stereolithograhpy in additive manufacturing

illustration not visible in this excerpt

Source: Own illustration, following University of Northern Iowa (n.d.)

SLA allows manufacturing goods and prototypes much faster than using other alternative methods. However, being the first invented additive manufacturing technology, SLA cannot offer the wide range of possible underlying materials and the level of strength, which FDM or SLS methods can achieve. Overall, stereolithograhpy is good for manufacturing basic prototypes, but not for making strong products (Buy 3D Printer, 2014).

2 Current and future potential of additive manufacturing

2.1 Recent development of 3D printing industry

In the last several years, 3D printing industry has started growing rapidly and reached the market size of around $2.6 billion in 2013 and is projected to reach the value of almost $12 billion by 2020 (Wile, 2013). The number of commercial 3D printing machines has increased from 355 in 2008 to around 23,000 (Statista, 2014) in 2013, showing a growth of 6400%. The overall 3D printing market value has increased from around $1,1bn in 2009 to $2.6 billion in 2013, showing a CAGR of around 24% (GSV Capital, 2013).

Fig. 5: 3D printing industry value ($ billion)

illustration not visible in this excerpt

2.2 Benefits of 3D printing in comparison to traditional manufacturing

The growth alone is not enough to change conventional manufacturing industry. Innovations and new solutions are required. In fact, 3D printing offers several advantages over traditional manufacturing. Those include (Garett, 2014):

1) Increase in product design freedom: traditional manufacturing is constrained in terms of using different designs and styles. Additive manufacturing will allow using a wider range of designs and materials.
2) No additional cost for complexity: in traditional manufacturing, products that are more complicated inevitably lead to higher costs. Using 3D printing, there is no need to change the process to produce goods that are more complex.
3) Production in batches of one: traditionally, it is expensive to produce single unique goods. However, in 3D printing there is no huge difference in costs between printing a single unit or mass production.
4) Higher degree of customization: additive manufacturing implies producing goods layer by layer; therefore, it will be much easier to bring the necessary adjustments to the product without changing the complete manufacturing design.
5) Simplification of manufacturing process: since 3D printers use an already designed digital model, the operator’s involvement and level of expertise are not as important as in traditional manufacturing.
6) Eliminations of supply chains and assembly lines: additive manufacturing makes it possible to produce the whole product in one process; in comparison, traditional manufacturing often requires hundredths or even thousands of steps between the beginning and end of the production cycle.
7) Instant production on global scale: as most designs for 3D printing are accessible on the internet, it will be possible to start the production anywhere in the world, where the access to the internet is available.
8) Reducing waste and emissions: in additive manufacturing only the material required for production is used, which leads to almost no waste. Moreover, printing goods locally will decrease the need for transportation and as a result cut the CO2 emissions.

2.3 Application of 3D printing in various industries

All that benefits make additive manufacturing attractive for various industries. As shown below, Fig. 7 illustrates that many businesses from consumer products to military use additive manufacturing for their needs.

Fig. 7: 3D printing revenues by end market (2012)

illustration not visible in this excerpt

Source: Own illustration, following 3Ders (2013).

Opportunities to use 3D printing are not limited to the industries mentioned in the Fig. 7. More and more businesses will be able to capitalize on the development of the 3D printing as the technology will develop further pushing the costs down. Right now 3D printing is most commonly used in three industries, which are consumer products, motor vehicles and medical industry. Those industries accounted for 57% of the 3D printing market in 2012.

However, it is likely that in the next several years 3D printing will become common in such industries as organ replacement, consumer electronics and many others. Right now, it is still not possible to produce such things as human organs using 3D printers but scientists already learned to make small parts of human tissues and believe that printing a human liver will become possible in the nearest future (Mearian, 2013). As for consumer electronics, one cannot print an entire smartphone yet, however such companies as Xerox and Optomec are currently developing innovative solutions to make it possible to print electronic equipment (The Economist, 2012).

Information in Table 1 on the next page illustrates the global opportunities in 3D printing industry and shows that there is a vast opportunity for the expansion of the additive manufacturing in different industries.

Table 1: Global opportunities in 3D printing

illustration not visible in this excerpt

Source: Own illustration, following Faktor (2012).

As shown in the table, additive manufacturing will benefit not only big corporations, but also small to midsized businesses and private consumers.

3D printing will certainly change all the industries mentioned in Table 1. Be it production of toys, which will become possible for parents without leaving home; be it global apparel industry, which will benefit from shorter lead times and possibility to produce dresses in small quantities or be it manufacturing of bicycles, so that you will not have to worry about someone stealing your bike.

However, the most striking and impressive changes are likely to occur in such industries as food, organ replacement, medical prosthetics, arms & military and finally in the house building.

2.3.1 Additive manufacturing in food industry

A good example of additive manufacturing in the food industry is the company Natural Machines headquartered in Barcelona, Spain. The company has developed a first commercially available 3D printer able to print savory foods, called “Foodini” (Molitch- Hou, 2014). The printer does not make up ingredients itself, but requires the consumer to put them into printer. Once ready, “Foodini” uses liquid ingredients to print the food. Another bright example of how food companies are integrating additive manufacturing in their business is the Italian company Barilla, which has announced plans to put a 3D pasta printer in every restaurant over the course of the next several years (Molitch-Hou, 2014).

Food printing is clearly only beginning to develop and can usually produce only liquid food. However, there already exists a great potential for printing liquid food. Especially among elderly people (Molitch-Hou, 2014). One in five people over the age of 50 has swallowing problems, which require them to eat liquefied food. Making liquefied food with 3D printers may help in one of the biggest problems of the modern developed world - aging population. As the percentage of elderly people will continue rising, this will mean that there are more and more people with swallowing problems in need of liquid food.

Finally, printing food may also benefit babies, who can only digest liquefied products.

2.3.2 Bioprinting

Organs and live tissue printing is a very promising area not only because it will likely save thousands if not millions lives every year, but also because it will create a new level of research and development in pharmaceutical industry, which relies heavily on human organs and tissues to test new drugs.

Right now, organ printing is not yet developed and only allows to print parts of human tissues and muscles. However, the first 3D printed liver is expected to be manufactured in 2014 by Organovo (Mearian, 2013). This liver will be used for further studies as the mass scale printing of organs, which can be transplanted to humans, is most probably a very far perspective.

2.3.3 Printing prosthetics

Despite all the opportunities in organ replacement, additive manufacturing is likely to benefit medicine more in the area of medical prosthetics (Weldon, 2014). For instance, in the United States by 2020 there will be around 10 million people using orthoses or prostheses (American Academy of Orthotists and Prosthetists, n.d) accounting for about 3% of the total US population.

Printing prosthetics has a number of advantages over traditional manufacturing. The first one is the price. A bright example of how the prices for conventional prosthetics differ from printed is the story of Jose Delgado, who got his prosthetic hand printed at a cost of $50 compared to the $40,000 conventional analog (Chavez, 2014).

The next advantage is the speed of manufacturing, as building the traditional prosthetic is a very complicated process, which can take up to several weeks and requires many adjustments in the process of manufacturing.

The final advantage of 3D printed prosthetics is that they can be changed more often than their conventional analogs thanks to the much lower price. As a result, growing children who need prosthetics can fully benefit from them without the need to buy a new device for several thousand dollars every several months.

2.3.4 Additive manufacturing in military forces

In the end of 2013 American company Solid Concepts manufactured the 3D printed metal pistol (Szondy, 2013). Pistols printed from plastic have already been manufactured before, while the gun printed by Solid Concept was first of its kind.

This raises a question, whether guns printing will become mainstream and whether everybody having a 3D printer will be able to print an M16 at home. The development of the additive manufacturing will definitely make it one day possible to print a gun at home. However, one should not overestimate the danger of the printed guns as the plans for improvised firearms and explosion have been on the internet for years but have not lead to a sharp rise of violence.

Instead, in military and arms, 3D printing is likely to affect the supply of the troops (Chalcraft, 2012). Right now, deployed troops, especially in the remote areas, highly depend on the supply of everything from food to spare parts. Additive manufacturing is likely to improve the supply of the troops and will lead to their higher autonomy.

In April 2014 the first US navy warship took a 3D printer to sea (Freedberg, 2014). Even though the printer installed in the warship was not able to produce real spare parts, one day it might become possible to print everything necessary in the sea, be it on the submarine or a warship, without depending on the supply from the mainland.

2.3.5 Printing houses

Around one billion people in today’s world live in slums. 3D printing could make the lives of these people better and safer if the cheap houses could be printed. Fortunately, this is possible thanks to the researchers from the University of Southern Carolina. They created a 3D printer, which can build a 2,500 square foot (~230 square meters) house in only 24 hours (Magdaleno, 2014).

A few months after the invention, a Chinese company build 10 houses, each with an area of around 2,100 square feet in 24 hours (Goldin, 2014). The houses were built from the recycled materials and their cost was only around $5,000 each.

As seen on the example of printing houses, additive manufacturing in this case might not only improve lives of millions of people, making housing much more affordable, but also protect the environment by using only recycled materials in the construction.

3 Prospect of additive manufacturing in the near future

3.1 Opportunities and challenges of 3D printing

Despite all the developments in the additive manufacturing technology, 3D printing is yet far from completely changing our lives and becoming such a widespread technology as conventional printing.

Right now, there are more challenges than opportunities in additive manufacturing (see Appendix l). The biggest difficulties are that the material and printing costs are high and the range of materials, which 3D printers can use, is small. Moreover, local manufacturing, one of the most promising opportunities in the additive manufacturing, which is likely to change the way goods are produced and transported and change the whole manufacturing industry, is yet not developed.

The only developed characteristic of the additive manufacturing so far is resolution.

Material and printer costs are not likely to decrease substantially before 2020, whereas material selection is about to substantially increase no earlier than by year 2025. Another challenge for additive manufacturing, adequate design software, is not likely to be completely met before 2025 even though Adobe added 3D printing support to Photoshop in the beginning of 2014 (Taylor-Foster, 2014).

As for the key opportunities for 3D printing, they are yet underdeveloped and are not likely to materialize in the nearest future. Cheaper aftermarket parts and repairs for 3D printers is only going to develop by 2020, whereas such exceptional traits of additive manufacturing as local manufacturing and customization will likely become mainstream only by 2025.

3.2 Pricing of 3D printers

One of the main issues of new technological products is their prohibitively high price. 3D printers are not an exception. Right now, the average price for a 3D printer is several thousand dollars, which makes them very expensive not to mention the price of the components including materials to print and spare parts.

Therefore, a question arises, when the price of 3D printers will decrease enough to make them available for mass users. Nobody can give a precise forecast on the development of prices of 3D printers. However, comparable price developments of other once disruptive technologies can be observed to get an idea, when will 3D printers finally become affordable.

The figure below provides an overview of price developments of digital cameras and laser printers, which are now considered a mass market. Based on this data, a projection of price change of 3D printer is derived.

Fig. 8: Price developments of 3D printers compared to that of other technologies

illustration not visible in this excerpt

Source: Own illustration, following BCG (2013).

As seen in the table, the price of a new technological product usually decreases by more than 90% 15 years after their introduction to the market. This leads to an assumption, that by the year 2022 the price of personal 3D printer will be around $500 dollars, which is even lower than the current price of a new IPhone ($700).

3.3 Additive manufacturing as a mainstream technology

The final question is when the technology of additive manufacturing will become mainstream. To answer this question an example of once disruptive innovations as satellite navigation, e-mail, digital cameras and MP3 is analyzed. These four technologies did not immediately change the modern world. For instance, thirty years have passed since the MP3 format was invented in 1982 until the moment when the sales of the MP3 files overtook that of traditional CDs (BCG, 2013).

The table below illustrates how different disruptive technologies emerged from being invented to the moment they started rapidly developing to, finally, becoming mainstream.

Fig 9: 3D printing potential evolution compared to that of other technologies

illustration not visible in this excerpt

Source: Own illustration, following BCG, (2013).

4 Conclusion

4.1 Results

Additive manufacturing is likely to have a deep impact on all spheres of lives. The changes associated with this new technology will not only be seen in traditional manufacturing. As described in chapter two, 3D printing will change almost all dimensions of today’s life.

The supply chain as we see it today will likely be changed forever. Instead of many conventional steps, which are required to produce the final product from the raw materials, only two steps will be left, which are putting raw material in the 3D printer and getting the final product out of it.

Such a dramatic change of the manufacturing process might negatively affect different industries and make many people unemployed (Madam Eureka, 2012). However, new technologies usually do not ruin the current businesses but lead to the great improvements and creation of new jobs. Once industrial revolution did not make all the people in manufacturing unemployed but lead to a great improvement within the industry. After the invention of computers, some people also believed that computers would do the entire job for people. Computers, however, just made the life much easier but did not replace humans. Finally, after the internet became mainstream, there were talks that communication will change forever and people will stop meeting in person. Nevertheless, internet only improved the communication with such companies as Skype emerging in the market.

Additive manufacturing will definitely change the world and most of the conventional industries. However, these changes will be positive. World with developed 3D printing will be a cleaner world with fewer emissions, a world, where new business can emerge thanks to lower dependence on suppliers, a world, where a five year-old child without a limb can grow up with an affordable prosthetic and a world where one billion people will not have to live in slums.

4.2 Limitations

Despite all the potential benefits of the additive manufacturing, there is a number of limitations, which require a further research.

The first limitation lies in the very nature of 3D printing - production layer by layer. As printed goods are not integral, unlike that made using traditional technologies, they cannot offer the same level of durability. Therefore, it is questionable, whether additive manufacturing will ever be able to offer the same level of strength as conventional manufacturing does. In different industries, such as aircraft building, durability is of the critical importance. This makes appliance of 3D printing unlikely in various industries, which rely highly on the strength of their products.

The second limitations is that 3D printing is yet not as environmentally friendly as many believe. For instance 3D printers that use laser to melt plastic consume up to 100 times more electricity to produce a same single product, compared to analogs in traditional manufacturing (Choudhury, 2013). Moreover, the belief that 3D printers do not produce any waist is also far from true, as 3D inkjet printers waste up to 45% of the materials (Meijet, 2014).

The third limitation of additive manufacturing is that it is not clear, whether the technology is really developed enough to print such goods as guns, prosthetics, human 14 organs and many others. The news about unique products, which were printed, and cost only a fraction of their conventional analogs are most likely the result of work of many years, many people and huge initial investments. This in turn might mean that additive manufacturing is yet not as developed as many believe it to be.


Table of appendices

Appendix l: Challenges and opportunities in 3D printing 17

Appendix l: Challenges and opportunities in 3D printing

illustration not visible in this excerpt

Source: Own illustration, following Kaur (2013).

Reference list 0-9

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Chalcraft, E. (2012). US military invests in 3D printing on the frontline. Retrieved from: frontline/ [Accessed: 25.05.2014]


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Madam Eureka (2012). The Economic Impacts of 3D Printing. Retrieved from: [Accessed: 25.05.2014]

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Szondy, D. (2013). Solid Concepts manufactures first 3D-printed metal pistol. Retrieved

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T. Rowe Price (n.d). A brief history of 3D printing. Retrieved from: raphic_FINAL.pdf [Accessed: 24.05.2014]

Taylor-Foster, J. (2014). Adobe Photoshop Becomes a Tool for 3D Printing. Retrieved from: tool/ [Accessed: 25.05.2014]

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University of Northern Iowa (n.d.). Major RP technologies. Retrieved from: [Accessed: 24.05.2014]


Weldon, D. (2014). 3D printing could revolutionize medical prosthetics, SME says.

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27 of 27 pages


Economic Consequences of 3D Printing
Leipzig Graduate School of Management
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Victor Butorin (Author), 2014, Economic Consequences of 3D Printing, Munich, GRIN Verlag,


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