CASTING AGENT : Speed of 3D System’s Computerized Machine Adds New Dimension to Production of Plastic Models

The doors burst open as a teen-age girl, seriously hurt in an auto accident, is wheeled into a hospital emergency room. The diagnosis: a skull fracture that requires surgery within a few hours.

A CAT scan of the girl’s head gives doctors a general idea of where the injury is. But to narrow their focus, the scan is electronically fed into another machine that in less than 3 hours produces an exact duplicate of the girl’s skull in a heavy, clear plastic form. Now the doctors have a precise road map of where the surgery will take them.

This story is fictional, but the technology is not. 3D Systems, a 2-year-old Valencia company, recently began selling a machine that combines a laser, a computer and liquid chemicals to rapidly produce models of all sorts of objects, ranging from skulls and other human bones to auto parts, buildings and perfume bottles.

Saving Time

3D says its machine can make models in minutes and hours instead of the days and weeks required with conventional modeling materials such as clay, foam or metal. Besides giving doctors a new diagnostic tool--a project 3D is working on with UCLA--the company believes that its machine can save U.S. industry hundreds of millions of dollars and countless hours in the development of models for new products.

The machine already has been sold to such industrial giants as General Motors, Eastman Kodak and IBM. Ciba-Geigy, a major Swiss chemicals concern, became so enamored with 3D’s technology that in July it invested $30 million to buy 37% of 3D.

The machine costs from $150,000 to $185,000. Housing two computers, a laser and a vat of liquid chemicals, the machine is about the size of a refrigerator. But models made from the machine cannot be much larger than the vat, which is slightly smaller than a microwave oven.

Faster Marketing

Still, engineers at GM’s Fisher Guide division, which provides parts and accessories for GM cars and trucks, have said the machine could substantially cut the time needed to bring new parts to market.

“I think we’ve got the possibility of taking a year off the development of a car,” which can take 4 years or more, said Raymond S. Freed, 3D chairman and co-founder. The company last week moved from its old facility in Sylmar to a new, 65,000-square-foot plant in Valencia. Paring development by a year could save an auto maker more than $350 million, he said.

But such conquests must remain for the future. Besides the limited size of models that can be made by the machine, 3D is still a tiny company, which, after starting full-fledged sales only 6 months ago, will have sold about 32 machines for $5 million by year’s end, Freed said. However, its work force has shot up to 105 from 30 a year ago.

In the first 9 months of the year, 3D had a loss of $3.4 million--not uncommon for new high-technology companies--on sales of $2.7 million. Freed, 61, conceded that he’s “flirted with some low cash periods,” but said 3D “should be profitable” in 1989.

Guiding Laser

The machine works this way: A design of, say, a car’s outside mirror is drawn on one of the sophisticated computer-aided-design, or CAD, systems widely used by engineers. The design is fed into 3D’s machine, which features a laser that rests above a vat of liquid plastic. Guided by the computer, the laser’s beam draws a pinpoint line on the surface of the liquid chemicals to create the bottom cross-section of the mirror. Immediately, the first section turns solid and the machine drops it a fraction of an inch. Another cross-section is created in the liquid above it, and this process is rapidly repeated hundreds of times until the entire model of the mirror is completed.

Manufacturers like to have prototype models of parts to see how the product will look. Avon, for instance, sells perfume in bottles that were made from 3D-generated models. Builders routinely make models of structures to see how they use land space.

Car makers use models for testing before they spend millions of dollars on tooling up manufacturing plants to actually build the parts.

For example, they’ll want to know whether the outside car mirror is sufficiently wind-resistant or matches the car’s overall design. GM’s Fisher Guide makes about 250,000 models and prototypes a year.

The machine “enables us to make decisions much more quickly” with new products, said Michael McEvoy, director of advanced engineering at Baxter Health Care, a major health-care concern that uses the machine to make models of syringes, intravenous-fluid kits and other products.

The machine’s combined use of lasers, chemicals and computers is what got the attention of Ciba-Geigy, which also owns Spectra-Physics, a San Jose-based company that is the biggest U.S. laser producer.

With 3D’s need for lasers and chemicals for its machines, Ciba-Geigy is “extremely interested in this new methodology that marries” the two products and represents new markets for the Swiss concern, said Spectra-Physics spokesman George Dies.

‘Very Formidable Company’

And to 3D, Ciba-Geigy is much more than a major investor. Ciba-Geigy is developing new liquid chemicals that could help 3D produce a wider range of models at a faster pace. Also, Spectra-Physics is selling the machine in Europe and could eventually provide more powerful lasers for future generations of 3D equipment.

“We represent a whole lot more than 105 guys in a building in Valencia,” Freed said in reference to Ciba-Geigy. “I think we’re going to be a very formidable company.”

3D was founded in 1986 by Freed and 3D President Charles W. Hull, an engineer who was most responsible for developing the technology. The pair sought financing from several U.S. venture capitalists, but most weren’t interested. So Freed found a Canadian venture capital firm, Lionheart Capital, which invested $4.8 million in 3D.

Lionheart also created a holding company, 3D Canada, to hold its stake. 3D Canada owned 70% of 3D Systems, and Freed, Hull and other insiders owned the rest.

To recoup its investment, Lionheart sold 25% of 3D Canada to the public via the Vancouver Stock Exchange, a market long known for its penny stocks and other speculative issues. And the hype about 3D Systems’ machine took off.

Stock Soars Then Sinks

After the stock came to market at $1.70 a share, it quickly got as high as $9, but soon fell to the $5-$6 range. A year later, the stock has moved to the U.S. over-the-counter market and still trades in the $5-$6 range.

Which suits Freed fine. He wants the company’s sales and earnings performance to drive the stock up rather than just hype.

In July, Lionheart was bought by Ciba-Geigy, giving the Swiss company its stake in 3D Canada. And early next year, 3D Canada and 3D Systems will merge. Ciba-Geigy will own 37% of the merged company, which will have 13.5 million shares outstanding; 3D’s founders will own 30% and the public will own 33%.

Freed owns 12% and acknowledged that “of course it’s gone through my mind” that one day Ciba-Geigy might buy all of 3D. But Freed said he doesn’t care about the money. In 1961, he founded Elec-Trol, a Saugus electronic parts manufacturing company, and sold it for millions in 1982.

He cares about the technology. Freed said he sees a day when 3D machines take computer drawings and immediately develop actual products--skipping the model-making process altogether.

“I do not think it would be impossible for us before too long to make a car door that will fit right on the car, not just a model,” he said.