China challenges Tesla with low-cost humanoid robots. State support is driving development, but it remains to be seen who will win the race for artificial helpers.
China’s Push into the Robotics Industry
At this year’s World Robot Conference in Beijing, over two dozen Chinese companies presented humanoid robots designed for use in factories and warehouses. With this, China is challenging the U.S. company Tesla in the emerging market for battery-powered humanoid robots. These robots could not only increase efficiency in production but also revolutionize the way various industries work.
China’s strategy follows a proven pattern that was already successful in promoting electric cars more than a decade ago. The combination of state support, intense price competition from numerous new market entrants, and a well-developed supply chain is intended to ensure success in this new industry.
“China’s humanoid robot industry shows clear advantages in supply chain integration and mass production capability,” emphasizes Arjen Rao from the Chinese research institute LeadLeo to Reuters. These advantages could prove decisive when it comes to winning market shares in international competition.
State Support and Market Potential
The efforts are supported by President Xi Jinping’s policy aimed at developing “new productive forces” in the technology sector. In January, the city of Beijing set up a state-sponsored robotics fund of $1.4 billion to promote research and development in this area. Shanghai announced similar plans for a fund in July, underlining the Chinese government’s commitment to this industry.
The market for humanoid robots is growing rapidly and could soon produce many new companies. Goldman Sachs predicts that the annual global market for humanoid robots will grow to $38 billion by 2035. Material costs per robot are said to have fallen to around $150,000 in 2023, not including research and development costs. These cost reductions could allow new companies to enter the market and offer innovative products.
Chinese Companies in Competition
Some Chinese companies are already showing promising progress. Hu Debo, the CEO of the startup Shanghai Kepler Exploration Robotics, expects that the fifth version of his work robot, which is to be tested in factories, will cost less than $30,000. His company states that it was inspired by Tesla’s humanoid robot Optimus, highlighting the direct competition between the two players.
The Hong Kong-listed company UBTECH Robotics is already testing its robots in Geely’s car factories and has announced an agreement with Audi. According to project manager Sotirios Stasinopoulos, UBTECH plans to start mass production next year. Over 90 percent of the components for their robots come from China, further strengthening local manufacturing and the associated cost advantages.
Although Chinese competitors and analysts see Tesla as having an advantage in artificial intelligence, they believe that China can significantly reduce production costs. Tesla itself plans to produce Optimus in small series next year, which is likely to further fuel competition.
Outlook for the Future
Xin Guobin, China’s Vice Minister of Industry and Information Technology, stated that his ministry has implemented President Xi’s guidelines and made China an “important force in the global robotics industry.” By 2025, the country plans to begin mass production of humanoid robots, albeit on a much smaller scale than with electric vehicles.
Analyst Rao from the LeadLeo Research Institute estimates that “it will probably take at least 20 to 30 years before humanoid robots can be commercially used on a large scale.” This long-term perspective shows that despite rapid developments in technology and state support, many challenges still need to be overcome before humanoid robots are widespread in everyday life.
Overall, China stands at a crucial point in the development of its humanoid robotics industry. The combination of state support, innovative companies, and a growing market could soon lead to China taking a leading role in this emerging sector.
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