Innovation

GE makes $1.4B bet on 3D printing, acquires two firms to boost additive manufacturing

GE recently announced plans to buy Arcam AB and SLM Solutions Group, continuing its efforts to gain a competitive foothold in the fast-growing 3D manufacturing space.

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A GE LEAP jet engine in a testing cell at GE Aviation's test facility in Peebles, Ohio

Image: GE/Chris New

On Tuesday, General Electric announced plans to purchase additive manufacturing companies Arcam AB and SLM Solutions Group for a total of $1.4 billion in an effort to ramp up large-scale 3D printing. The acquisitions could massively disrupt the current industry trajectory, experts say, and accelerate the use of metal additive manufacturing in several areas.

The two companies each bring different, but complementary, 3D printing functions, David Joyce, president and CEO of GE Aviation, said in a press release. Arcam AB, based in Mölndal, Sweden, owns an electron beam melting machine and produces metal powders for aerospace and healthcare manufacturing. SLM Solutions Group, in Lübeck, Germany, builds laser machines, also for metal-based 3D printing, used in the aerospace, automotive, energy, and healthcare industries.

Since 2010, GE has invested close to $1.5 billion in 3D printing technologies for manufacturing. "The investment has enabled the company to develop additive applications across six GE businesses, create new services applications across the company, and earn 346 patents in powder metals alone," the press release stated. The company expects to grow its 3D printing manufacturing business to $1 billion by 2020.

SEE: How GE is using 3D printing to unleash the biggest revolution in large-scale manufacturing in over a century

GE's potential acquisitions of Arcam and SLM marks a seminal moment for industrial 3D printing, according to Rick Smith, co-founder and CEO of Fast Radius, an on-demand manufacturing company backed by UPS.

"GE has been a leader in applying 3D printing for game-changing internal applications," Smith said. "These acquisitions mean that GE is now convinced of the broader disruption that is coming to global manufacturing and supply chains, as thousands of other companies begin to aggressively adopt these technologies. This validation from one of the most respected industrial companies in the world will send ripple effects across the entire industry."

Indeed, industrial 3D printing continues to become more popular, with global spending on printers reaching nearly $11 billion in 2015. Spending is predicted to rise to about $27 billion by 2019, according to International Data Corporation.

About two-thirds of US manufacturers are now adopting 3D printing in some way, according to a PricewaterhouseCoopers report. Half are using it for prototyping and final products. And 52% of manufacturers expect 3D printing to be used for high-volume production in the next 3-5 years, the report found.

"Additive provides a new palette for engineers to create. Parts are also being designed in GE Power, Oil & Gas, Healthcare and across GE's services businesses," said Joyce in the press release. "We see value potential to reduce product cost... Ultimately, as we develop more productive machines, we can build additive manufacturing 'as a service' for our customers."

GE Aviation began selling 3D-printed fuel nozzle interiors for jet engines in July. More than 11,000 of such engines are currently on order with up to 20 fuel nozzles in each, the company stated, with production expected to rise to more than 40,000 fuel nozzles by 2020. The company is also creating 3D-printed military engine components.

SEE: Stratasys teams with Japanese automaker to customize cars with 3D printing

"I believe GE's acquisitions of two of the leading metal additive manufacturing system developers will significantly accelerate the realization of metal additive manufacturing as a next-generation advanced manufacturing technology," said Scott Dunham, vice president of research at SmarTech Markets Publishing and a 3D printing industry analyst.

While leaders in metal additive manufacturing system development have been growing their capabilities for the past five years, they have been slow to integrate into mainstream manufacturing, Dunham said.

By combining Arcam AB and SLM with GE, a global multi-billion dollar manufacturer that has a lot of experience using metal 3D printing machines for manufacturing applications, Dunham said he would "expect an acceleration in the timeline in widespread implementation of metals-based additive manufacturing across a number of industries, thanks to the combination of end-user experience, process-specific expertise, and a significant global presence in manufacturing."

GE is currently making the necessary filings to acquire each company. It plans to continue using the headquarters and key operating locations of both Arcam and SLM, and retain each company's employees, the press release stated.

The 3 big takeaways for TechRepublic readers

  1. General Electric announced plans to purchase additive manufacturing companies Arcam AB and SLM Solutions group for a total of $1.4 billion on Tuesday, in a move experts say will accelerate the use of such technologies in mainstream manufacturing.
  2. Since 2010, GE has invested about $1.5 billion in additive manufacturing technologies, and plans to grow its 3D printing manufacturing business to $1 billion by 2020.
  3. Industrial 3D printing is growing, with about two-thirds of US manufacturers currently adopting 3D printing in some way, according to a PricewaterhouseCoopers report.

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About Alison DeNisco Rayome

Alison DeNisco Rayome is a Staff Writer for TechRepublic. She covers CXO, cybersecurity, and the convergence of tech and the workplace.

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