3-D Printing technology will make good on its promise to enable the Third Industrial Revolution, says the investment firm Ark Invest (New York City).
Sure, 3-D printing has been hyped. But in many ways, the technology is undervalued, maintains ARK Invest, which anticipates that the annual growth rate for the technology will be approximately 40% for the next five years. “It is $5.5 billion dollars today. We see it going to $40 billion by 2020,” says ARK Invest analyst Tasha Keeney, who recently wrote a white paper on the subject.
Little Consensus on the Technology’s Potential
Global estimates for the 3-D printing market vary widely according to various estimates. The most optimistic firms—such as McKinsey and ARK used top-down models to arrive at their figures. “The highest estimates were from McKinsey, which is predicting that the market will expand to be worth anywhere from $180 to $490 billion by 2025,” Keeney says. “We think that most analysts in the lower end of this range are taking today’s growth rates and extending them outwards. But ARK and McKinsey are estimating the percentage of the market that could adopt 3-D printing and derive their calculations for the future market size from that.”
Using a top-down projection of 3-D printing’s future could be wise. Consider how firm Wohlers, which has used a bottom-up approach, has nearly doubled its estimates for the 3-D printing market in 2020 timeline twice. “Their 2012 estimate was $6.5 billion. In 2013, their estimate was $10.8 billion. And in 2014, it shot up to $21 billion.” Wohlers’ 2016 estimates are expected later this year.
In any case, it is difficult to make projections about the market size because 3-D printing is still in its infancy—despite having been around in some form or another for decades. “If you look at the total addressable market, — prototypes, tools, molds, and end-use parts—it is the hundreds of billions of dollars,” Keeney says. “But the penetration is still relatively low.
While 3-D printing is most commonly used for prototyping, there is still considerable room for growth in this market niche as well as in other sectors. “The end-use-parts market is currently next to nothing. That is the next wave we see as being the largest addressable market.” A good example is the shoe market. Already, companies like Under Armour, Nike and Adidas are beginning to use the technology in shoes. Expect more 3-D printed end-use parts in the consumer and medical sectors to follow.
Despite the tremendous potential, in 2015, the public stocks of many of the big 3-D printing company were discounted, including major players Stratasys and 3D Systems. “There is a massive opportunity for growth that is not being recognized. Right now, the market is at the sweet spot of the saddle adoption curve,” Keeney says.
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