How Can Additive Manufacturing Help Businesses Make the Most of the IRA?13 February 2023
[Image Credit: EcoAct]
On August the 16th, 2022, a governmental movement was passed in the United States aimed towards tugging inflation rates down and reinforcing the “nation’s social safety net”, with investment in clean energy placed high in its priorities. The bill was labelled the Inflation Reduction Act.
With global production sectors shouldering the responsibility for one-fifth of the world’s carbon emissions, as well as consuming 54% of the world’s energy sources, it comes as no surprise that the IRA’s initiatives are set to make waves in the manufacturing industry.
However, the IRA intends to reduce wasteful production habits and convey the US closer towards the global Net 0 goalpost whilst simultaneously bolstering the US manufacturing industry. This approach is also evidenced in President Biden’s Executive Order 14005, ‘Ensuring the Future is Made in America by All of America’s Workers’, designed to encourage America-based production and dilute reliance on outsourcing.
A selection of the IRA’s movements are dedicated to encouraging cleaner customs in the manufacturing industry at the same time as helping these sectors to grow. A notable few include the provision of tax credits on the basis of certain conditions being met, such as the predominance of domestic production, and the implementation of STEM apprenticeships. In this way, manufacturing companies will be demanded to independently reach for positive change in order to access the governmental benefits being extended.
However, actually attaining these ideals is no walk in the park. Though the overarching sentiment of the IRA is to support and nurture, some industry representatives are concerned that damage may instead be wrought by the Act. Jay Timmons, president and CEO of the National Association of Manufacturers (NAM), expresses concern that “harsh economic headwinds such as supply chain disruptions” currently characterising the manufacturing landscape will make benefiting from the bill’s incentives difficult, especially when larger manufacturing companies will experience heightened tax rates to fund the initiative.
Yet, this is not to say that there isn’t a path towards the bill’s success. Of the possible approaches to making the most of the IRA’s initiatives, grasping the dual win of reinforcing business operations and reducing carbon emissions, additive manufacturing is a strong candidate for the task.
In this article, we delve into how expansion into 3D printing can powerfully support businesses seeking to profit from the IRA’s historical enforcement.
Easing Onshoring Initiatives
The first and most direct advantage of 3D printing for businesses looking to capitalist on the IRA is its aptness to onshoring initiatives. To distil some of the points raised in our full article on this subject, ‘How is 3D Printing Helping to Onshore Manufacturing?’, let’s take a closer look at how.
Flexibility is one of additive manufacturing’s most defining benefits. With the simple seed of a CAD file, AM allows users to print highly intricate geometries at high speeds and from almost any material imaginable, from plastics and metals right through to recycled materials and even human cells.
These qualities are precisely what suit additive manufacturing to onshored operations. Shifts in market preference can immediately be reflected in production with additive manufacturing, a transfer which can be difficult to coordinate across seas.
Parts can be printed as and when needed, adhering to fluctuations in demand and supporting a just-in-time (JIT) lean manufacturing approach. Even materials need not be outsourced, with the sheer expanse of options open for the technology to rework.
Tying these strings together, 3D printing paves a clear road towards moving manufacturing back to home shores, checking the ‘domestic-production’ and ‘domestic-procurement’ boxes off of the IRA’s tax credit conditions list.
Most importantly, though, the dramatic reduction in long-haul transportation required for additive manufacturing slashes a hefty sum of carbon emissions. Whilst enhancing business efficiency on an individual level, the impact of its widespread industrial permeation has the power to deliver groundbreaking impact through what Biden calls the “most significant investment ever in climate change”.
Opening Up New Businesses and New Markets
On both sides of B2B and B2C exchanges, additive manufacturing opens up the floor for rejuvenation and innovation, reviving interest and excitement about manufacturing amongst the younger working population, as well as attracting attention from new audiences.
Growth of this kind is precisely what the IRA is intent on promoting, with a focus on ‘jump start[ing] R&D and commercialization of leading-edge technologies’ (Mckinsey), in turn encouraging the growth of “small businesses […] core to economic growth” (Manufacturing Tomorrow).
Indeed, President Biden has already invested in 3D printing’s promising support of onshoring. Last year, just 3 months before the IRA was passed, Biden backed the launch of the voluntary manufacturing compact AM Forward, aimed at supporting the dispersal of additive capabilities across the US manufacturing sphere and “bringing good-paying manufacturing jobs back home” by “investing in small and medium sized companies” (White House). With interest already piqued in the technology, business adoption of AM provides the chance to tap into the IRA’s doubled R&D tax credit for small businesses.
On the other hand, the IRA provides “a great opportunity for suppliers and manufacturers to expand their existing idea of a target customer,” according to Dwight Morgan, Executive Vice President of Corporate Development at M. Holland.
Additive manufacturing provides an ideal means to seize the opportunity Morgan refers to, with its growing eminence encouraging more and more to invest in the new possibilities the technology opens up. AM’s current industrial position suits it perfectly to “new businesses […] springing up to take advantage of IRA-related incentives”.
A Catalyst for New Talent
Another notable aspect of the IRA is its objective to build robust talent pipelines for STEM subjects, fuelled by tax credit eligibility if apprenticeship conditions are met by companies looking to benefit.
With the manufacturing labour shortage only continuing to draw out, expected to hit over two million vacant jobs by 2030 according to a prediction from Deloitte, this aspect of the bill holds the power to subvert this trend at this time of need.
The soaring interest in 3D printing within manufacturing sectors and beyond thoroughly suits it as a subject of training, likely to attract broader numbers of potential students. Furthermore, Biden’s priorly demonstrated enthusiasm for the technology has already exhibited the need for promoting wider AM expertise.
“SME manufacturers must train their workforce differently to successfully deploy additive capabilities, including upskilling workers,” claims the Biden Administration Fact Sheet on their endorsement of AM Forward, pledging to join the voluntary compact in “assist[ing] manufacturers in launching apprenticeship programs in additive manufacturing”.
Here once again can be seen the harmony between the IRA’s incentives and 3D printing’s capabilities. In this technology comes an opportunity to capture the value which the bill endeavours to deliver, and transform it from an ideal into an exciting reality.
A Win For Our Businesses and A Win For Our Planet
The most striking promise extended by the Inflation Reduction Act is its proposed deliverance of dually edged profit.
The advantages it levels target not just the ‘manufacturing industry’ as a whole, faceless entity. Instead, it drills down to each of its individual components, to all of the singular businesses and to the difficulties which they face as realities day in and day out.
At the same time, the integrality of manufacturing to societies across the globe makes a bill which targets its conventions impactful for each and every one of us. The multifaceted nature of the movement’s impacts, bolstering vital operations in a way which avoids an environmentally damaging flipside, is what will lend it its strength.
To truly wring the greatest benefit out of these governmental pledges, however, identifying the right route to success will be more than imperative. As this article has endeavoured to display, additive manufacturing extends the perfect key to unlocking the IRA’s permanent and powerful prosperity.
Enjoyed this? Check out our previous article, ‘3D Printing is Revolutionising Spare Part Production in Land Defence: Here’s How It Works’.
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