United Parcel Service Inc., the world's largest package delivery company, said on Wednesday it will expand the 3-D printing services provided through its UPS Stores to create an on-demand manufacturing network starting this summer.
Atlanta-based UPS and SAP SE also announced a partnership in which Europe's largest software company will provide supply chain solutions to help manufacturers get products to market more quickly and at a lower cost.
"Speed is critical to us and we see tremendous value" in extending SAP's capabilities further down the supply chain via UPS, said John Dulchinos, vice president for strategic capabilities at contract manufacturer Jabil Circuit Inc., in a telephone interview with Reuters.
Dulchinos said thanks to recent technological advances the St. Petersburg, Fla.-based company, an SAP customer with $18 billion in revenue in 2015, expects to start making parts using 3-D printers in the next year.
Also known as additive printing, 3-D printers create three-dimensional objects by building up successive layers of material under computer control.
UPS already offers 3-D printing services using ABSplus, an industrial grade thermoplastic, at more than 60 UPS Stores around the United States.
Under the new system, customers will be able to upload digital designs to First Radius, a company specializing in 3-D printing in which UPS holds a minority stake. The part will be printed at the UPS Store nearest to them for delivery.
UPS said the network should benefit customers that occasionally need parts fast or industrial designers who need prototypes.
The automotive and aerospace industries have been exploring the possibilities of 3-D printing for some time.
Automaker BMW prints some car parts using metal alloy powder -- heated in a forge to make them stronger -- and manufacturing conglomerate General Electric Co. recently began testing a jet engine made with printed metal parts.
Metals company Alcoa Inc. is investing $60 million to expand a research and development center to explore ways to make 3-D printing viable on an industrial scale for the aerospace, automotive and construction sectors.
IDC Research Inc. analyst Robert Parker said the network will bring UPS only modest benefits at first because 3-D printers have limited capabilities at present and few printable materials available.
But as 3-D printing advances UPS could build on this initial step and use its global logistics network to deliver printed parts fast, he added.
"UPS is taking a pole position with this service and in the long term this makes a great deal of sense," Parker said.
(Reporting by Nick Carey in Chicago; Editing by Matthew Lewis)