The 3D printing industry is growing at an astonishing pace and we are seeing more companies enter the market every day. The most recent addition to the 3D printing segment of the New York stock exchange is Voxeljet (VJET), the German manufacturer of industrial 3D printers. The company operates Europe's largest service center for the on-demand production for moulds and models for metal casting. The company produces smaller entry level models as well as large-format machines.
Products and Services
Voxeljet has two business divisions: Voxeljet Systems and Voxeljet Services - Systems division focuses on the development, production and distribution of printers and the services unit focuses on creating sand moulds and plastic models. Together, these both divisions cater to some of the biggest players in the automotive industry, and create substantial synergies for the company and its customers. Voxeljet has five 3D printers in its portfolio - these printers range from small-scale to large-format 3D printers. The biggest of these printers is VX4000, which has the largest build space of any other 3D printers available in the market.
The large build space allows the manufacturer to produce large components and decrease the cost of moulds and casts. The build space of the printer is 4000x2000x1000 mm, which is more than six times bigger than the next commercially available 3D printer in the market. Due to the large printing head, the printer enables the manufacturer to have small efficient batches as well as fast manufacture of oversized individual objects. On the other hand, services unit offers sand molding and casting to its customers and allows them to manufacture accurate models from their designs. The services segment also offers plastic models manufacturing for investment casting and design models.
Target Market and Growth Opportunity
The target market for the company is mainly the industrial manufacturers - Voxeljet boasts names like Daimler AG, Ford Motors (F) and 3M Co (MMM) in its customer base. At the moment, the installed base of the company consists of 52 printers. Since the target market of the company is massive, the growth opportunity for Voxeljet is immense. Build space, size and printing speed matters a lot in the industrial segment of the 3D printing industry. Voxeljet has a competitive advantage over its peers as it has the largest build space and fastest printer in the market.
Build box sizes and printing speeds of Voxeljet printers allow the manufacturers to produce components more efficiently. Furthermore, the company believes in building strong relationships with its customers and has an impressive global sales agent network. At the moment, Voxeljet has a strong presence in Europe and North America - however, Asia Pacific is still open to the company. Further future growth will come from the Asia Pacific region as the company has started to shift focus to this region. Furthermore, services segment is currently only catering to European customers. The company is now planning to expand services segment to North America and Asia. Currently, there are 25 sales agent working for Voxeljet worldwide.
The biggest competitor for Voxeljet will be Stratasys (SSYS) and to some extent 3D Systems (DDD). Stratasys mainly operates in the industrial segment of the 3D printing industry and the company has some of the best systems available in the market. However, Voxeljet's build size and printing speeds give it a considerable advantage over its competitors. For the last two years, domestic/hobbyist segment and medical devices segment has been growing at an astonishing rate - however, in future, the industrial segment is expected to take over these two segments in terms of growth. As a result, 3D Systems is also making an effort to expand its industrial printer portfolio, but it remains considerably behind Stratasys in this segment. The focused approach of Voxeljet will allow the company to get a substantial chunk of the pie as these three players fight it out for the largest share of the industrial 3D printers market.
Voxeljet is a pure growth story and the reaction of the market to its IPO indicates that the stock was underpriced. Voxeljet has a solid portfolio and massive growth opportunities and I believe the company will continue to grow in the short-medium term. At the moment, the manufacturers are moving from conventional tolling and molding techniques to 3D printing, which bodes well for companies like Voxeljet.