Read time: 18 mins.
Key highlights:
- The price is right: Exploring how labour, R&D, sales, marketing, and more affect the price point of AM systems.
- At face value: Insights from past and present OEM CEOs.
- What's to come: How industry consolidation and the rise of Chinese competitors might impact the cost of AM machinery.
The true cost of industrial additive manufacturing technology can be difficult to determine, difficult to communicate, and therefore difficult to understand. There is the upfront cost of the printing hardware, the upfront cost of ancillary equipment that rounds out the ‘solution’ or ‘platform’, and then there is the cost of utilisation. These can be divided into the ‘hurdle cost’ (adoption) and the business case cost (application).
Machine manufacturers and their clients do not always see eye to eye on the subject, and such is the lack of transparency around the figures involved, it can be challenging for trade media and analysts to fall down on one side.
How, when enabling the manufacture of parts never before possible, you could argue, can users think they’re paying too much?
But how, when end users report, for instance, average machine utilisation rates of 60%, can machine manufacturers demand seven-figure sums for their product?
And how, when very few AM machine manufacturers are profitable, can we expect them to lower the cost of their systems?
All salient queries that make answering the question of why industrial AM technologies cost what they cost akin to opening a can of worms.
But that is what this Deep Dives report set out to do. Ideally, it wanted to provide a detailed, pennies and pounds breakdown – based on real-world AM products and derived from current or former AM business leaders – of how R&D, the bill of materials (BOM), materials development, sales, distribution, portfolio proliferation, fragmentation tax, and profit margins all affect the price point of an AM machine.
Work to this end was ongoing right up until the deadline, with former and existing business leaders typically (and perhaps understandably) hesitant to divulge such information.
One former OEM CEO, Avi Reichental (formerly of Nexa3D & 3D Systems, and now CEO of Quickparts), did agree to provide a rough cost breakdown. Another, Filomeno Martina (formerly of WAAM3D), wouldn’t do so, but in his own 1800-word commentary, he explains his reasons. And two business leaders representing Stratasys (Rich Garrity) and Nikon SLM Solutions (Sam O’Leary) agreed to share some broader perspectives. ADDMAN CEO Joe Calmese offered insights from the end-user side of the discussion.
Several more invitations to participate went unanswered. And, as has become clear in the writing of this piece, a similar report exploring the true cost considerations of adopting the technology ought to be produced.
