Protolabs, the US-based manufacturing company that specializes in low-volume 3D printed, CNC-machined, and injection-molded custom parts for prototyping and short-run production, announced it is closing one German facility and eliminating the metal 3D printing from another.
The plan includes the closure of the Protolabs injection molding facility in Eschenlohe, Germany, and its metal laser powder bed fusion 3D printing services through its facility in Putzbrunn, Germany, just south of Munich. The company maintains its other manufacturing facilities in the US (Minnesota, New Hampshire, and South Carolina), England, and Japan, and says it will continue offering all its services to customers across Europe. These services will be fulfilled through existing facilities and a network of manufacturing partners.
“Protolabs has decided to focus on plastic additive manufacturing at the Putzbrunn facility and to align the company’s European 3D printing center more closely with these technologies,” Daniel Cohn, Protolabs’ managing director & 3DP lead EMEA. “Customers will continue to receive the usual Protolabs DMLS quality – the investments of recent years and the Protolabs network are paying off.” DMLS refers to the company’s metal laser powder bed fusion 3D printing abilities, also referred to as direct metal laser sintering.
In January 2024, Protolabs rebranded its partner network formerly known as “Hubs”, which it acquired in 2021, to “Protolabs Network”. This network consists of more than 250 manufacturing partners to expand Protolabs’ capabilities and available pricing options.
With new contract manufacturing partners, there was less incentive to operate its own facilities. Protolabs invested €19 million in its 65,000-square-foot Putzbrunn 3D printing center in 2020 that features a collection of additive manufacturing technology and more than 130 skilled technicians. In 2023, the company opened a 120,000-square-foot facility in North Carolina.
Cohn says that the existing DMLS printers that will no longer be needed in Putzbrunn will be used by Protolabs elsewhere in the company.
Despite still being able to service European costumes, the Eschenlohe factory shutdown will cost the publicly traded company an estimated $4.5 million to $6.0 million.
Business analysts Richard Durant said in his Seeking Alpha column that Protolabs Network business “is driving growth, but it is unclear if it is creating value or strengthening Protolabs’ competitive positioning.”
Competitors in Europe, including Munich-based Craftcloud, also offer a wide network of hundreds of manufacturing partners, some of which are the same as Protolabs’.
Navigating Manufacturing Contraction in 2024
Protolabs’ President and Chief Executive Officer Robert Bodor said in the company’s June second quarter 2024 earnings call that manufacturing activity has contracted in the US and Europe and Protolabs is “currently operating in an environment that is challenging and customers have been impacted by macro factors, including higher interest rates, reduced demand for manufactured goods, broad-based cost-cutting efforts and moderating capital expenditures.”
Operating through a network of partners is expected to lower Protolabs overhead costs, but the rise of other network-based manufacturing service companies, such as Fictiv, Protiq, Jiga, and Republique, will make it difficult for Protolabs to differentiate its offerings.
Correction: An earlier version of this article stated that the Protolabs facility on Putzbrunn, Germany, will close. That facility will not close, but it will no longer offer metal 3D printing. We regret the error.
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