The 3-D Printing Market Is Going To Be 357% Bigger Than We Initially Thought

CREDIT SUISSE: The 3-D Printing Market Is Going To Be 357% Bigger Than We Initially Thought
ROB WILE
JAN. 22, 2014, 5:14 PM 3,068 3
If you need more evidence that 3-D printing and additive manufacturing are viable business sectors, try this.
A Credit Suisse research team led by Jonathan Shaffer has revised the firm’s 2016 projection for the market up 357%, to $800 million from $175 million.
The reason: overlooked opportunities among consumers and “pro-sumers,” which Shaffer defines as engineers, architects and educators.
3-D printing and additive manufacturing are basically used interchangeably to describe printing readymade objects and components from your own office or home, short-circuiting the normal, capital-intensive industrial production process.
Shaffer explains how this technology could gain widespread use:
We think eventually there could be near ~100% penetration amongst engineers as it becomes a common element of the engineer’s toolkit…The number of registered architects in the US [now stands at 222,500]. We think this represents another potential growth driver, although we acknowledge the computer design proficiency amongst architects is likely lower than among recent engineering graduates…We think children under 18 will be a primary driver of adoption; they are more likely to have heightened computer proficiency, and technological awareness is high in this age group.
“Pro-sumers” are the key. Shaffer says that professional and dedicated but amateur tinkerers will find great use for on-the-spot printing to help them realize prototypes. “We think eventually there could be near ~100% penetration amongst engineers as it becomes a common element of the engineer’s toolkit,” he says.
This group is also less sensitive to costs than regular consumers. “Reliability, print quality, build size and service are key pro-sumer concerns rather than simply price, and the new generation of printers do more to address these concerns,” he writes. Shaffer says the prices pro-sumers would be willing to pay for a new desktop unit tops out at $7,500 versus $1,500 for consumers.
Shaffer concludes by upgrading Stratasys to “outperform” from “neutral” with a target price $144 from $128, while downgrading 3-D Systems to “neutral” from outperform, holding the price target at $90. That’s because Stratasys bought MakerBot, which is among the leading brands in the market: Shaffer estimates sales doubled in the second half of 2013 alone, and will have more than tripled by 2016. He adds he was impressed by two new MakerBot models at CES he had not accounted for in his models.
The note came out Tuesday and caused the share prices of the companies, which had been trading in tandem, to instantly diverge. 3-D is in red: