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Posts tagged production costs

Economics of Additive Manufacturing

I’ve written previously about the advantages of digital fabrication and additive manufacturing (3D printing) specifically. But how do the economics for 3 D printing stack up in the real world against conventional manufacturing techniques such as injection molding.

Summarizing 3D printing selling points:

  1. Ability to print shapes and assemblies likely impossible with other methods – such as intricately formed or nested shapes and structures.
  2. Ease of creating custom shaped objects to meet individual parameters – such as ergonomically tailored sports or medical devices.
  3. Ability to manufacture low volume, but high value objects cost effectively by eliminating expensive tooling and molding.

3D printing offers some clear advantages in the instances one and two above. For instance one, when there are no other physically feasible manufacturing options for a particular form, 3D printing is the only choice. Printing simply does what cannot be accomplished by other means.

Instance number two is somewhat similar. A custom formed object/device fits an individual perfectly and will be produced only once or at most a few times for that person. A conventionally injection molded piece might be too expensive, given the high costs of molds. 3D printing has a clear advantage in both these cases. But what about case three – an anticipated low volume run or a situation where it doesn’t make sense to invest in sizable opening inventories?

Let’s look at an example. In two previous posts I described digital fabrication of a moderately complex lamp of my design, using 3D printed plastic and laser cut acrylic parts. The lamp is made of a central hub which holds the electrical socket and has twisted fins that extend to attach laser cut pieces comprising the lamp shade. (see the white finned hub component in the picture below). What would a comparatively low volume conventional, injection molded hub piece cost, versus the 3D printed version?

Fortunately, it’s now possible to get online quotes for both injection molded and 3D printed parts. I used www.IcoMold.com to estimate injection molded hub pieces and www.Shapeways.com for 3D printing estimates.

3D printing vs. injection molding

Total manufacturing costs, for selected quantities from 1 – 75 units are shown above. Costs exclude design and shipping and compare injection molding (red line) and 3D printing (blue line). The major cost with injection molding is the mold, itself, which in this case, costs about $8,500. In a convenient statistical breakoff, manufacturing runs of less than 50 units yield a lower total cost than for 3D printing.  As can be seen, there are few economies of scale in printed parts, aside from perhaps amortizing design and reducing inventory costs. Unlike molding, the 75th part costs as much as to produce as the first unit. Having said this, manufacturing runs greater than 50 may also be cost effective for 3D printing when factoring in inventory/stocking costs.

What does this analysis suggest? Extremely limited volume and custom, one-off, high value parts and products will be increasingly produced with 3D printing. We can also expect that as 3D printing costs decline – as they surely will – more and more spare parts and limited production parts will be fabricated by printing. Another important cost factor not included here is that transportation costs – and carbon footprints – should be reduced. Many injection molded parts are made in China, requiring extended supply chains and logistics which are costly in both financial terms and environmental impact. Printed parts are also easier on cash flows. With greatly reduced upfront manufacturing costs, entrepreneurs can invest in products with less trepidation.

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We develop and market energy efficiency strategies and technologies. We focus on the building and transportation sectors, which account for more than two thirds of the energy budget.

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