BASF Spins out 3D Printing Business Forward AM — Analysis

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BASF is spinning out its Forward AM 3D printing materials unit. Current CEO Martin Back will lead a management buyout of the firm, which will include the Sculpteo business and the materials companies. The new entity will be called Forward AM Technologies. All current products will continue, and the company highlights its 30% growth rate and continued focus on manufacturing resilience.

CEO Martin Back said, “I would like to express my gratitude to BASF for all their support during the MBO (Management-Buy-Out) process. By working together, we could ensure that our team of experts and the innovative tools currently in place can continue to provide leading AM solutions to the manufacturing industry in times of volatility. The team at Forward AM is truly passionate about shaping the future of manufacturing and all the exciting opportunities to build and grow within this innovative AM community. I’m looking forward to this empowering journey ahead.”

He continued:

“It is a very exciting time to be part of the AM industry. Building on excellence in materials, services, and solutions, we’re going to continue to drive innovation through our work and collaborative efforts with our partners. We know the manufacturing sector faces growing volatility and uncertainty, creating a demand for more resilient and sustainable materials and agile solutions. Forward AM is here to deliver on that demand head on. This new venture emphasizes our continued commitment and dedication to providing expedient and robust AM solutions, focusing on the success of our customers and partners. Together, we are proving that AM technologies are integral to the future of manufacturing. Together, we will keep moving forward.”

What happened?

Martin is enthusiastic about 3D printing, but BASF isn’t. Years ago, the German chemicals giant could afford to take a small gamble on the 3D printing industry. However, after investing tens of millions, it has not grown sufficiently to be relevant for BASF. Given the high margins, quick growth, and promise of local manufacturing, the firm initially felt that AM had a future it wanted to be part of. BASF, with a revenue of around $70 billion, is broadly under assault from lower-cost Chinese competitors, who are encouraged to buy everything locally. Much production is now based in China. This competition only began to really sting after Russia’s gas blackmail scheme went awry.

Cheap Russian gas in return for looking the other way was suddenly not possible anymore, causing energy prices in Germany to increase drastically. BASF has some of the largest integrated production sites in the world there, which normally makes sense due to efficiencies and the ability to make new products from waste products cheaply. However, BASF, which backed the Nordstream pipeline, began to cut and save in late 2022 as energy prices rose precipitously. Notably, they were very volatile in Germany specifically, while other countries in Europe had much lower and more stable prices. Moreover, BASF’s processes and business model are based around cheap natural gas in perpetuity. BASF is ever-present and makes most anything, except its own energy. The firm’s energy costs rose by more than $800 million in a quarter, prompting it to drastically reduce investment and manufacturing in Europe. After this, sales declined by over 21% and profits by 29%. Even after cutting $2 billion in costs, the needle didn’t move upward; in fact, demand declined. At the same time, dreams of a Made in Germany, 3D printing, Industry 4.0 panacea didn’t hold true for the company either.

Panic Football

The hand stop 3D printed with BASF Ultrafuse PP GF30 was modified to provide stability while aiming the rifle with a fractured hand.

In short, poor scenario planning by the group left their business essentially untenable. No one dared to ask the question, “What if the dictator no longer acts rationally?” What if, for some reason, natural gas became much more expensive? This is a fair question to ask if you have one of the world’s largest production sites, engineered to only run on natural gas. It seems that, at BASF, hedges are only for gardeners. It is difficult to understand how they couldn’t predict or hedge against this.

Forward AM has grown, but not enough to fill the hole BASF has dug for itself. It’s like taking a salt shaker and trying to fill an open pit mine. In Dutch, we have an expression, “paniekvoetbal,” or panic football. A player breaks through, and you rashly tackle them in the box, causing an avoidable penalty. Or a fast dribble causes you to kick the ball wildly, creating a corner. Panic football is thinking with only emotions, buckling under pressure, and letting the moment guide you instead of thinking straight when you need to. You may have seen some panic football by our national team lately. It’s a term that describes BASF management of late: calm faces, but echoes of Bayer-like hubris cloaking miscalculations. Forward AM, therefore, has become a luxury amidst a flurry of activity masking a profound lack of judgment by BASF management.

What is Forward AM´s Current Situation?

AM Forward has a broad portfolio of materials across the 3D printing landscape. I don’t like the brand and continually confuse it with the Biden initiative. However, it offers filaments, powders, resins, and more. The firm’s filament business must be under pressure from Prusa Research’s Prusament and Bambu Labs. It needs to deploy its brand more broadly and smartly worldwide to shore it up. Its powder business is growing but lags behind Evonik and Arkema. It’s hard to see the company gaining an edge over these two firms in powder bed. Meanwhile, nimble competitors like Lehmann and Voss continue to do well.

In resins, it contends with Henkel, which is pushing into more functional resins. Companies like Formlabs are also increasingly developing and making their own materials. Evonik is broadening its materials portfolio, and Stratasys’ material business continues to generate cash. Arkema’s Rilsan products do well, and the company continues to innovate. On the TPU side, it has Lubrizol to contend with. Forward AM had some formidable applications people who were really driving growth forward, but it got rid of many of them. It has less customer contact, knowledge, and application-specific expertise than, for example, Stratasys. The company also has few hit products and doesn’t really dominate any particular domain.

Having said this, it is a pure-play independent player with a broad portfolio. It will not be easy, but growth prospects could continue to be very good, especially if the firm can keep investing. More application-specific propositions will be necessary, but if it chooses the right partners, it may break these open. It leads in bound filament at the moment, but this has not been the growth engine expected because debinding and sintering equipment is expensive, and making parts is initially difficult. If it becomes efficient while still developing applications, it will do well. Industrial manufacturers will want several players propping up the market, and there are fewer of them now.

Is this good for the industry?

Martin and the team will be very committed. The new company will be more agile and able to make rapid decisions. Compared to its corporate peers in Arkema, Evonik, and Stratasys, it could seize opportunities quicker. It could jump into newer markets and ink partnerships faster as well. It could have more market power and distribution than smaller firms while being faster than the larger ones. Having a nimble player in the market with a broad portfolio would, therefore, be beneficial. We won’t see huge long-term investments in things like bound metal, but we may yet see many materials created. A more responsive player would be very good for everyone.

Given the number of technologies the company is active in, the R&D budget will be quite thin. However, there is still steady demand for good materials at reasonable prices, which is something to be hopeful about. In the desktop market, there is still not a trusted resin brand available at a reasonable price, and there are more opportunities like this.


Now, the era of the large polymer companies has officially ended. DSM, Dow, Braskem, Covestro, and all the rest were legion. For a while, they drove innovation in this industry. Now their interests and influence are much diminished. What needs to be done now is to create appropriately priced, well-performing materials that enable the industrialization of manufacturing. Forward AM seems well-placed to grow but will have a difficult time dislodging Evonik and Arkema from their fortresses and Stratasys from its combined value propositions.

Forward AM will either need to find new niche products (such as FF PA11 GF for rail, similar to Kimya) or make huge strides in creating a consumer brand in resins that beats out low-quality suppliers while staving off competition from Prusa Research in filament. It will need a lot of well-staked-out niches or a dominant position in the high-volume consumer market, supplemented by industrial materials revenue. It will be a tough challenge, but it’s doable.

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