About a week ago, The Wall Street Journal profiled a defense manufacturing startup called Divergent Tech, currently valued at $2.3 Billion. They make vehicle frames, suspension systems, and missile parts through what they call “end-to-end” digital production, meaning they both design and manufacture with 3D printing in mind.
Divergent Tech has seen growth opportunities in the military and private sectors, but they were also perceptive enough to see one key risk looming on the horizon: many of their printers and parts were dependent on global supply chains.
Many companies would prefer to buy from a manufacturer that has a completely domestic supply chain, and the tariffs have negated much of the cost advantage previously held by China. But if Divergent is dependent on Chinese suppliers to keep their printers running, they are moving the line on risk, but not solving for it.
When they wanted to build an entirely domestic supply chain, they found what many companies looking to reshore have also found out: the supply base they need does not exist here. They are solving that problem in their own way, but it made me think… Are the costs and uncertainty of tariffs enough to tip the sales in favor of 3D printing at scale?
3D Printing Plusses
3D printing (or additive manufacturing) can be done on demand, which shortens lead times, reduces the need to hold excess inventory, and minimizes material waste thanks to the ability to create custom components.
Eliminating duties, freight, and delays brings the cost of 3D printed parts closer to the cost of conventionally manufactured parts, but shortening those lead times is the big win.
Deloitte reported that during COVID, companies using 3D printing were able to “reduce lead times by a stunning 70% compared to those relying on traditional supply chains.” I would agree that a 70 percent lead time reduction is indeed “stunning,” but Deloitte may have underestimated the benefit, perhaps because of other supply chain delays and disruptions playing out at the time.
In my reading, I found multiple sources that suggested lead times can be reduced by 90 percent, and even 95 percent in some cases. That is like erasing lead times altogether, especially when you consider the fact that companies would no longer need to iterate with suppliers around the world to get the specifications right.
Although 3D printing has typically been done with composite materials, much like plastic, metal additive manufacturing is now making headway. Half of the metal 3D printing done in the United States today uses titanium. This has opened the door to 3D printed rocket parts and even components for nuclear reactors.
Risks & Downsides of 3D Printing
Although additive manufacturing generates a lot of enthusiasm, it is just one tool in the toolkit, not a solution for all parts' needs.
Defense manufacturing is particularly sensitive to foreign-based risks and supply disruptions, but they are less sensitive to cost. It is no surprise that they are among the first to embrace 3D printing at scale.
For the private sector, it will take a little longer (and maybe a closer examination of cost structure) to take the same plunge. Even when they do, their focus is likely to be about components v. end-use or for-sale parts. They will also still need to understand their supply chain, as the benefits of 3D printing could be negated if the components still have to be shipped abroad for final assembly.
According to Professor Jennifer Johns, Director of Research at the University of Bristol, “It is not as simple as moving production of X from country Y to country Z, rather the relocation of tiers of component manufacture in national territories. If AM can reduce the number of component suppliers for any product/component it will make relocation of its production significantly easier. We know many examples of this, typically motivated by weight and material reduction, but tariffs could drive more serious consideration of the geographical footprint of production.”
Cost (Modeling) is King
Thinking about, and therefore being able to accurately calculate, the cost to 3D print an item is critical.
A new study from researchers at the Budapest University of Technology and Economics titled “Refined Cost Calculation Framework for FDM [fused deposition modeling] Parts” suggests we’ve been missing the bigger picture in 3D printing cost drivers.
Their research breaks down the cost of making a 3D part into 5 components:
- Material costs
- Support removal costs (when using a chemical solvent)
- Machine operation costs (including depreciation, maintenance, and energy use)
- Tooling
- Labor (including manual removal of supports if not done using a solvent)
It is step 4, tooling, that they point to as the primary issue in accurately capturing what the nozzle is doing during a printing job.
We cannot assume that a printer’s time in use leads to equal wear, because sometimes the printer head is just repositioning before laying more material. Jobs with a long print time, but low material usage are usually overestimated in a straight time-based model. These are more sophisticated jobs, but they lead to less nozzle wear. The cost to print dense items with a
short print time but high material usage is usually underestimated. Hobbyists and the military are currently leading the way, but today’s supply chain trends may see private sector manufacturers catching up.
The costs of 3D printing are relative and must be analyzed from a total cost of ownership perspective, but leveraging additive manufacturing at scale will require a huge model shift, even though the cost and timing benefits are substantial.
This wouldn’t be the first ‘great new thing’ to disappoint, but it might just be crazy enough to work… especially given today’s global trade conditions.
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