Siemens, 3D printing and the awakening beast

Plans have been revealed to create one of Europe’s largest 3D printing manufacturing facilities.

Article updated: 21 March 2018 5:00pm Author: Michael Baxter

3D printing is the perfect example. A technology can sound fantastic in theory, but until it reaches a certain stage of development, until it can make applications that are of genuine use, it can feel disappointing.
Meanwhile, the mood among investors can oscillate from one of excitement, creating massively valued stocks, followed by disappointment.

But then we get the next stage, things begin to happen, products get produced that people want, products appear that are useful, then it can be like a rocket - the market takes off.

The best time to invest is probably the moment of extreme cynicism. The opportunity is for investors who can see this cycle for what it is.

In February 2011, The Economist ran a lead story with the headline: ‘Print me a Stradivarius.’ The 3D printing/additive manufacturing business had been noticed. There followed a period of hype, all kinds of wild predictions followed - it would be like having a state of the art factory that could make anything in our garage or spare room, suggested the hype. It would mean the end of mass production, the end of international trade: manufacturing would become a kind of cottage industry again, but one of extreme sophistication. So that was the initial hype stage.

Then, by around 2013 and 2014, the cynical phase began. Every person I spoke to who knew anything about 3D printing said: ‘it was overhyped technology’, that would only ever have niche applications’. When I wrote about it here, I got torn off a strip in the comments section.

At this time, I was doing a project looking into the feasibility of making cars by 3D printing - I got quite embarrassed, I can say. The guffaws of laughter from experts concerning such a notion were really rather loud.

Yet, around four years later, I read a company from Italy, L Electrical Vehicles, has revealed plans to sell 3D printed electric cars for $10,000, targeted at the mass market. It reckons that the first cars will be available in 2019. Consider the disruptive implications if that gained traction, if 3D printed cars became more popular than mass produced cars, the auto industry would be turned on its head.

You can now have your house 3D printed. It also costs $10,000 and can be made in a day. Is that disruptive or what?

The obvious applications

Maybe you think I am getting ahead of myself, let’s consider the obvious applications for 3D Printing.
Firstly, making bespoke products, or products for which the market place is quite small, making mass production non-economic. So, one example might be unique products used in health-tech, designed for the individual, or niche applications, such as in subsets of aircraft manufacturing.

A second application involves making products which, because of their shape, would be quite hard to make using traditional manufacturing methods. Returning to Siemens, its partner in the UK investment, Materials Solutions, 85 per cent owned by Siemens, makes gas turbine blades using additive manufacturing.

The third area is in the development of prototypes. That in itself is exciting, with the potential to greatly speed up the development of new products and test them.

One of the ideas that has become very popular among more entrepreneurial businesses is based on the book: The Lean Start-up. It means that when developing a new product, produce a simplified version as quickly as possible and test it, 3D printing can be very supportive of that.

Siemens

Siemens and Materials Solutions have much bolder ideas. They are developing a £27 million additive manufacturing facility in Worcester.

Phil Hatherley, general manager, said: “Our new facility will give us the space and scope to continue to innovate for these specialist and demanding industries and achieve a shift in the perception of 3D printing from being a technology associated with prototyping to a viable option for the serial production of additively manufactured parts.”
Of course, the UK government is waxing lyrical about this - the move by Siemens supports the government’s aim to ensure the UK is smack bang in the middle of the so called Fourth Industrial Revolution.

Other companies to watch

For me, the really interesting thing about additive manufacturing is its disruptive potential: its potential socio-economic impact.

But there are 3D printing companies whose shares trade on the stock market - usually the US. They include 3D Systems, ExOne and Stratasys, but in each case shares are substantially lower than peak in 2014.

The Hype Cycle

As said above, I reckon that new markets, such as the internet in the late 1990s, AI, virtual reality and 3D printing go through three stages: hype, cynical and take-off. Gartner has a grander model, which it calls the hype cycle - which it divides into five stages. But it is broadly saying the same thing. Its latest version of the hype cycle breaks 3D printing into multiple areas. It has, for example, 3D printing in medical devices at the peak of hype, 3D printing for prototypes at a mature stage and 3D printing in manufacturing processes and consumer goods as entering a stage it calls the trough of disillusionment. But then that report is nine months old, I think the next version will look more positive. Read more on the Gartner Hype cycle and additive manufacturing.

Personally, I think the collapse of the share price related to the above three companies is simply a sign that 3D printing still has a lot of cynical sentiment associated with it. Wait until we start seeing 3D printed products on the streets and in the home, then the market will look exciting again.


These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees.

Michael Baxter portrait photo
Michael Baxter

Economics Commentator

Michael is an economics, investment and technology writer, known for his entertaining style. He has previously been a full-time investor, founder of a technology company which was floated on the NASDAQ, and a director of a PR company specialising in IT.