There is the belief amongst investors that traditional automotive companies cannot keep up with new entrants into the automotive area during a period of explosive innovation: autonomous, electric vehicles, connected platforms, etc. Agility is not the strength of monolithic corporations steeped in historical ways of working and, therein, are seen as “slow to the game” versus neophytes who beta test new features on public roads. For the most part, that preconceived notion is flawed since those traditional manufacturers have the working capital to fuel innovation, whereas the startups are fighting to survive long enough to eventually see production revenues.
However, one fundamental function at these well-established companies might hurt their competitiveness in the coming years: the project-specific Buyer from the corporation’s Purchasing Department. Much like a Clydesdale, this blinder-laden workhorse is rewarded for its focused attention on the task in front of them – specifically a lower Bill of Materials (BOM) cost for the vehicle or system — and that myopic viewpoint is seen as an advantage over engineers who might get distracted by new technology. Yes, sometimes the glorified “BOM Manager” is provided some algorithmic consideration for intangible costs which are desirable (e.g., lower weight), but not always and usually a minor consideration. Get the cost down. Period.
Therein, the Buyer looks at additive manufacturing or 3D printing options, rejects it prima fascia based upon THAT part’s piece cost, and the dogmatic corporation misses the holistic viewpoint of multiple savings unlike the creative environment of a startup. Let’s look at those various use cases and understand the incremental value – upstream (a.k.a. before production), midstream and downstream — that could be realized in total if the trained personnel and printers were acquired.
This is the value most popularly known for additive manufacturing, but there’s more here than meets the eye:
Prototypes: Given the history of 3D printing, this is the most commonly known usage akin to Agile Development: create a “Minimum Viable Product” (MVP), test that with users and stakeholders and adapt the design based upon feedback. Yes, certainly a usage worth noting and helps the one-time engineering budget, but frankly is dwarfed in the grand picture.
Production Jigs and Tools: “There’s also tremendous savings and ‘speed to market’ value in additive manufacturing for applications in the factory like tooling, jigs, fixtures and assembly aids,” states Blake Teipel, CEO of Essentium. “If you look at the long pole in the tent to get a vehicle to market, it is tooling. It takes 52 weeks in some cases to get a tool designed, released, built, and milled.“ Certainly some BOM Managers translate Speed-to-Market into dollars per part, but rarely. Also, not accounted for is the waste created to qualify a part, which the time for qualifying, disposal, etc. has typically not be measured. Industrial experts estimate 60% of all manufacturing activities are waste, which are not properly considered upfront.
This premise was reinforced during the quick pivot in 2020 where automotive companies like Ford and General Motors assisted with ventilators, face shields, and other PPE for which they had nearly no history, designs, or tooling. If they were marching to that 52-week schedule, the 2021 survivors would just be seeing the first ventilators now. “We were just going as fast as we can,” said Ford’s previous Executive Chairman, Bill Ford Jr, which they did via 3D printing with 3M and GE Healthcare.
The Holy Grail for 3D printing has always been manufacturing at volume and, given a few technological breakthroughs, that’s now reality. But automotive is behind other industries like aerospace on adoption, in part because (you guessed it) not all of the savings have been recognized:
Low-Volume Manufacturing: Typically, the cost of production tooling is amortized over a million parts and, therein, plays a little role. But for smaller runs, that price tag becomes steep. “There are a lot of vehicles that are produced in sub-5,000 volumes,” states Teipel. “How many Cadillac ATC manual-transmission vehicles are produced per year? Additive Manufacturing is an enabler to facilitate niche runs.” And even high-runners like Ford’s F150 have upwards of a million buildable combinations, so some parts are still low-runners.
Light-Weighting: Fuel Economy has become a hot topic these days with Electric Vehicles (EVs) and Biden’s Green New Deal. “We’re running out of time. Experts tell us that we have 10 years to get on the right path, or global warming will reach catastrophic levels by 2050,” writes Pete Buttigieg, U.S. Transportation Secretary. So what does that need translate to for 2026 BOM planning? What will a lighter part be worth to a Chief Technology Engineer in five years? Good question. “You can print lattice-structures, honeycomb-structures, hollow-structures; you really start to employ additive manufacturing a part with a stronger material and a stronger shape and, therein, decrease the overall weight,” states Teipel. Meeting or exceeding Corporate Average Fuel Economy standards certainly means real dollars to companies, but is customer demand for fuel savings being captured? Typically not adequately.
Functional Safety: Those same lattice-structures in combination with special materials provide extremely strong parts with crumple zones. “Aerospace jumped on additive materials for three main reasons,” asserts Teipel. “Cost competitiveness, light-weight and functional safety. They could make parts for cabins that could pass the V0 Burn Test and that were adequately performant under their flame, smoke and toxicity requirements.” Shockingly, something as fundamental as safety is frequently not a multiplier for Buyers.
Supply-Chain Disruption: Nuclear meltdown in Japan? Supplier goes bankrupt due to the pandemic or the economic collapse of 2008? Storms in Texas just limited certain plastics for automotive trim parts? Suez Canal blocked? Any of these might cause temporary or permanent disruptions, which might force a quick pivot to manufacture elsewhere. That means lost revenue if vehicle builds stop, but also requires shipping, calibrating, testing, inspecting, etc. heavy tooling. Lots of cost with little agility. These unpredictable events create nightmares for capturing the true costs.
Unusual Shapes: Those that have worked with molded parts knows their limitations: certain shapes are either extremely difficult or flat-out impossible. And large parts create other difficulties, which translate into suboptimal designs and/or associated labor. “There’s a recent automotive application that’s normally two-shot, injection molded parts for the left-half and right-half HVAC, each of which have two halves that have to be inspected, assembled and reinspected,” says Teipel. “The parts are essentially the size of two trash cans and typically require a bunch of intermediate labor. Instead, we can print those directly, thereby saving the right-half/left-half, the joining process, and the inspect processes.” That’s the beautiful thing about additive manufacturing: the complexity doesn’t scale with the size. Headliners and cargo trim can cost thousands of dollars, in part due to the manufacturing difficulty. And costs can rise if the large parts require certain CNC mills that can deal with a large blocks of aluminum or steel, etc.
The part of the equation that’s the least likely to factor into the BOM Manager’s decision is Maintenance.
Parts Operations: Time for a math exercise. If there are, on average, 30,000 parts on a given vehicle, and in every given year of the U.S. market alone there are an estimated 260 models offered with a service life of 15 years, how many parts in a given year need to have tooling stored and maintained? How much inventory must be stored in dealerships and service bays around the globe? Trillions. And don’t forget about Europe, Asia, South America, Australia, etc.
Obsolescence: When pulling the tooling out of storage to create parts, the manufacturer overproduces for efficiency. But when that part is no longer needed, that extra inventory becomes unaccounted-for waste.
Part Availability: Low-volume parts are barely inventoried, so when the car breaks down the end customers might wait a long time for a part to arrive at the repair shop. And wait. And curse. So aside from the direct cost, that’s customer-satisfaction’s opportunity cost ringing the cash register as well as rental car costs.
In The End
The Buyer will have done his job. Albeit not heralded in Superbowl commercials akin to the infamous Clydesdale, he will have arrived at the desired destined with his requested delivery. However, had the blinders been removed, the Buyer would have seen the full financial picture of 3D printing and additive manufacturing.
And the chance to print money.