Some 3D printer providers are setting up manufacturing operations in the US, but is this a good approach?
The most recent example of this phenomenon is Meltio’s new Robot Cell, which provides DED-style metal 3D printing. As far as I can tell, this is pretty much the same as the company’s previous Robot Cell, so what’s the difference?
The key is in the product name, “Meltio Robot Cell assembled in the United States of America”. They explain:
“Industries in the Americas such as automotive, defense, aerospace, mining, energy, and oil and gas, among others, have seen an increase in the need for metal parts manufacturing in recent years and are increasingly relying on Meltio’s metal 3D printing technology. The United States is leading this surge in demand for manufacturing and repairing industrial parts.
To meet these needs, Meltio today introduces the Meltio Robot Cell – assembled in the United States – for use in industrial production chains.”
For US buyers, this makes some sense, because shipping will cost less and there are fewer border and security complications. It’s not clear whether the total cost of the system is actually less than if it was made overseas and shipped in.
That is, until you consider tariffs, which have been popping up in a completely unpredictable manner. That’s where this scenario gets more interesting. Why are some companies doing this?
Setting up operations in the US by non-US companies is, at the end of the day, a business decision. That decision depends on quite a few factors, and ultimately measured by a cost-benefit analysis.
It does cost more money to set up a manufacturing center in the US. Shipping would cost less. Labor might cost more. More customers, especially government organizations, would be able to purchase the equipment. Tariffs would be less.
And then there’s another one that’s looming around in the background: in the future, is it possible that the US might actually ban imports of any foreign 3D printer? If that were to happen, then non-US companies might suddenly find they’ve instantly lost a major market for their products.
The proposition sounds ridiculous, but then again, many ridiculous things have happened lately. Probably another one happened this morning that I missed.
We’ve already seen hints of a future ban, largely focused on Chinese-made devices that access cloud services. If a ban did appear, it may sweep up non-Chinese devices at the same time.
For a 3D printer manufacturer, that is a risk that must be dealt with. The company could accept the risk or attempt to mitigate it in some way.
One way to mitigate that risk is the same thing that Meltio and a few others have done: set up a manufacturer plant in the US. In all likelihood, it costs the manufacturer more to set up another plant, so the real play here is mitigating the risk of a future ban, along with opening up possible sales to governmental organizations that require US-made equipment.
Is this a good decision? For Meltio, they certainly believe so because they’ve done it. Would it be a good decision for other 3D printer manufacturers?
It all depends on their particular circumstances.
Via Meltio
