In the Advanced Materials space, 2015 was marked by the emergence of new production techniques (client registration required), new material design tools (client registration required), and new scandals (client registration required). Whether it was the launch of start-up Carbon 3D (client registration required) or Volkswagen’s fall from grace, these events generated significant media hype and corporate attention. Clients can expect these trends to continue in 2016 with increased momentum, but not every event creates a media frenzy. To guide clients in the new year, Lux highlights three trends for 2016 that may be flying under the radar:
- Carbon nanotube (CNT) products will – finally – make a splash. After years of hype and concomitant oversupply, the industry began a shakeout of undifferentiated players in 2013. The companies that have survived offer stronger technology and are beginning to offer products at scale (client registration required). For example, General Nano, producer of CNT sheets for aerospace electromagnetic interference (EMI) shielding, has scaled up production to around 100,000 m2/year (client registration required). What’s more, in 2015 it achieved a two orders of magnitude cost reduction, to between $10/m2 and $50/m2. At this price point, its sheets are a compelling alternative to incumbent metal meshes due to lighter weight and improved processing. General Nano now joins its main competitor, Nanocomp Technologies (client registration required), in offering nanotube sheet products at scale. However, it isn’t just CNT sheets finding success, as Molecular Rebar has licensed the use of its nanotube-rubber product for tires (client registration required), and Zyvex Technologies continues to add partnerships (client registration required). It’s no coincidence that all these groups are offering nano-enabled products, as this approach facilitates strong value propositions in target industries and captures more value than pure material plays. While clients should still expect plenty of struggles in the CNT space – it’s still flooded with lackluster start-ups (client registration required) prematurely scaling capacity – 2016 will begin bringing successes to balance out the failures to those developers marrying concrete technical value with wise business models.
- 3D printing start-ups and majors pivot to software and sensors for differentiation. 2015 saw the emergence of a wave of start-ups aimed at democratizing the 3D printing hardware space. From Cosine Additive in fused filament fabrication (client registration required) to Autodesk in stereolithography (client registration required) to MatterFab in laser sintering (client registration required), groups have differentiated themselves from major players by offering open material use and letting end users modify process parameters and hardware. At the same time, 3D printing majors’ control over materials and hardware has weakened dramatically, with rule-breaking groups like Stratonics gaining commercial traction. Open materials and hardware is the new baseline for innovators – going forward, new entrants and established players will need new angles for differentiation. MIT has given us a glimpse of one route – it used a cheap camera to implement a closed-loop feedback system, improving build quality dramatically without needing to add high end expensive hardware (client registration required). At the same time, improving printer quality and increasing printer size make the low-quality STL file format increasingly problematic – expect new standards and file formats as a differentiator, led by Microsoft’s .3MF format.
What They Said
Lux Research recently learned from Atriax Materials’ (client registration required) co-founder Dave Weiss that the company, a developer of aluminum metal matrix composites, ceased operations at the start of the new year due to lack of funds. The company, which in 2013 reported it was profitable, primarily targeted military vehicle suspensions, tank treads, turrets, and wheels, and offered a metal matrix composite recycling service that it claimed “paid the bills.”
What We Think
Atriax’s materials offered performance improvements in small scale batch tests, and the company, while modestly sized at 400,000 revenue and four employees, had strategic partnerships with General Dynamics, Oshkosh, and Eck Industries. It’s certainly possible that there were significant technical issues that were not apparent in 2013. For instance, scaling up the process at a reasonable cost was identified as a major barrier in our previous analysis. However, our overall outlook at that time was positive given the intriguing performance benefits, particularly its ability to increase strength and maintain ductility, and thus this development was not expected.
Overall, this closure may be a sign that large multinationals are pulling support from advanced metals start-ups. In particular, by reviewing aggregate Member Site (client registration required) data from company profile scorecards, Lux Research has found that there has been a decline over recent years in partnerships in the advanced metals space despite strong technology scores. In addition, major metal players such as Alcoa (client registration required) have found success by developing processes in-house. These trends point to multinationals shifting to internal development rather than partnership. While this puts small start-ups like Atriax at risk, it represents an opportunity for those looking to buy into the advanced metals space. Clients interested in developing advanced metals should keep an eye out for closures of advanced metals start-ups to pick up technology and expertise on the cheap. We will continue to explore recent and ongoing trends and hotspots in the advanced materials space in our upcoming State of the Market Report.
3D printing start-up MatterFab recently announced it can deliver metal printing systems of comparable quality to those of established players like EOS (client registration required) at one tenth the price. It plans to complete an initial round of performance tests in the coming months and ship test models to partners early next year. To further dig into these bold claims, we caught up with CEO Matthew Burris, who told us that MatterFab’s printer is a conventional selective laser sintering (SLS) platform with little technical differentiation from current printers; it can currently print on stainless steel. Matt said significant cost reduction is achievable by altering the design of the printer. He referenced the window into the print area as one example; this part was costly so he replaced it with a cheap webcam. In addition to these changes to peripheral systems, Matterfab will use lower-powered lasers, which Matt claimed could produce printed parts of equivalent quality to available systems. He also told us that the company will adopt an open materials model.
MatterFab’s claims of equivalent performance at a vastly lower price are hard to believe, especially considering the maturity of established SLS printer providers (see the report “Building the Future: Assessing 3D Printing’s Opportunities and Challenges” — client registration required). While cutting corners on peripheral systems will save it some money, the main cost of 3D printers is in the lasers, powder handling systems, and mechanics that move the laser and print tray. If MatterFab uses a cheaper, lower powered laser it will have to move more slowly over the metal powder to ensure that it is fully melted. This will in turn slow down build time and cause more widespread heating of the printed part, reducing accuracy and subjecting the part to multiple heating and cooling cycles, likely resulting in decreased part strength. Without a clear technical innovation, it’s uncertain how MatterFab will meet its performance and price goals. Until performance data becomes available, MatterFab’s claims should be regarded with skepticism.
However, this does not mean there is no potential market for the company. The tight controls on printable materials enforced by major industry players like EOS and 3D Systems (client registration required) create opportunity for emerging innovators to develop a wider selection of products and properties (see the report “How 3D Printing Adds Up: Emerging Materials, Processes, Applications, and Business Models” — client registration required). For instance, EOS only offers 12 metal print materials, a pittance compared to the thousands of commercially available alloys. This is a boon for MatterFab and its open materials platform. Instead of attempting to beat larger and more mature incumbents on price and quality, MatterFab should focus on customers who wish to print specialty alloys (client registration required) that can’t be printed today. This strategy has proven successful for electron beam melting (EBM) printer producer Arcam (client registration required), which works with clients to evaluate third-party materials for use in its printers.