China has the advantage in its ability to produce humanoid robots at a large scale, at low cost, and quickly train and deploy them.
Humanoid robots are AI-powered machines designed to resemble humans in appearance and movement. American tech companies are accelerating the development of humanoid robots, highlighting their importance to the future economy, according to CNBC. However, analysts warn that they are at risk of losing out to Chinese competitors.
Thomas Andersson, founder of UK-based research firm STIQ, believes Chinese companies could dominate the market. "The supply chain and the entire ecosystem for robots in China is so large that it's easy to repeat the development process or do R&D," he told the BBC.
Heavy support and investment in robots
Chinese companies have benefited greatly from government support. According to the Global Times, in early 2024, seven Chinese ministries, including the Ministry of Industry and Information Technology and the Ministry of Science and Technology, announced new guidelines to achieve breakthroughs in areas such as humanoid robots, quantum computers, high-speed trains and 6G devices. This not only created a favorable legal environment but also promoted the rapid development of robots.
Cities such as Beijing and Shenzhen have also set up high-tech zones, attracting many businesses and research institutes. For example, the Beijing Economic-Technological Development Zone currently has 110 robotics companies operating, forming a comprehensive industrial chain.
Shanghai even built a 5,000-square-meter humanoid robot training base with many specialized training scenarios such as welding, 3C product manufacturing (computers, telecommunications, consumer electronics), and automobile testing. In the initial phase, the base can train more than 100 humanoid robots at the same time and is expected to increase to 1,000 robots by 2027.
Ability to produce at a large scale at a low cost
In a February report, US bank Morgan Stanley estimated that the cost of manufacturing a humanoid robot currently ranges from $10,000 to $300,000, depending on configuration and application requirements. But according to Reyk Knuhtsen, an analyst at the independent US research and analysis firm SemiAnalysis, Chinese companies are producing robots at a cheaper price than the US thanks to economies of scale and superior manufacturing capabilities.
For example, Chinese company Unitree launched its G1 model earlier this year with a starting price of $16,000. The 130-centimeter-tall robot can walk at a speed of 7 km/h and carry a 3-kilogram load in its arms for up to two hours. Meanwhile, Morgan Stanley estimates that the cost of selling Optimus, Tesla's 180-centimeter-tall humanoid robot, is around $20,000. But Tesla will only achieve this price if it can scale up, shorten its research and development cycle, and use cheap components from China.
Humanoid robots are made up of thousands of parts, including a "brain" consisting of semiconductors, generative AI models and vision software, which is an advantage for the US. According to Morgan Stanley's analysis, 13 of the 22 companies working on robot brains are based in the US, including Meta, Microsoft, Nvidia, Palantir, and only two are in China.
However, the bank estimates that only 4% of the cost of making a humanoid robot is for the brain, while the majority is spent on building the body with a series of actuators, pistons and skeletons. Of the 64 companies that make body parts for robots, China has 21 and the US has 17. In addition, 56% of the companies in the world's humanoid robot supply chain are based in China.
In particular, China dominates the market for an advanced and expensive type of ball screw called a planetary roller screw, which is essential to most advanced robots today. US President Donald Trump’s tariffs on the country are likely to push up the cost of materials for robots for many manufacturers.
China is also a leader in the battery industry, holding 70-90% of the global market share at all stages of the lithium-ion battery value chain, according to the Carnegie Endowment for International Peace in Washington. The country also dominates the rare earth market, which is crucial for making robots. Tesla CEO Elon Musk said on April 22 that Optimus production was being disrupted due to China’s export restrictions on rare earth magnets in response to US tariffs.
Widespread applications in practice
China has demonstrated the ability to apply humanoid robots in many fields. The latest example is the first half marathon for both humanoid and humanoid robots held in Beijing on April 19.
Tiangong Ultra, developed by the Beijing Humanoid Robot Innovation Center, finished first in the robot category after 2 hours and 40 minutes for the 21.0975 km. Meanwhile, the first runner finished in 1 hour and 2 minutes. Although robots are slower than humans, the competition showed great progress in the development of robot mobility and interaction.
In January, Unitree had 16 H1 robots dance with a group of dancers to celebrate the Lunar New Year in a performance broadcast on Chinese national television. The robots impressed with their precise mechanical arm movements, which could spin and gracefully toss scarves.
China's humanoid robot dances at the New Year gala
UBTech's Walker S1 model at work at the Audi-FAW new energy car plant in China. In addition to Audi, major manufacturers such as BYD, Zeekr, Geely and Foxconn also use the Walker S series, with more than 500 robots already on order. At BYD's Shenzhen factory, the Walker S1 increases sorting efficiency by 120%.
Over the past five years, China has filed the most patent applications related to humanoid robots in the world, reaching 5,590 compared to 1,442 in the US, according to an analysis by Morgan Stanley. The International Federation of Robotics said that China has deployed more industrial robots in factories than all other countries combined since 2021. By 2024, Chinese companies will have launched 35 humanoid robots, accounting for two-thirds of the global market. Companies in the US and Canada will have launched a total of eight robots.
According to a report by SemiAnalysis in early April, Unitree's G1 uses no US components at all. The report also argues that China is the only country that can reap the economic rewards of intelligent robotic systems, including humanoid robots, "posing a threat to the United States because it is outmatched on all fronts."
"To catch up, US companies need to quickly prepare a strong manufacturing and industrial base, either domestically or through allies. For Tesla and similar companies, it may be worth starting to bring manufacturing and component supply back to the United States or to allies to reduce dependence on China," Knuhtsen said.
The humanoid robotics industry is still very new, but the race is becoming clear. "If the US, Europe, Japan, and South Korea do not act seriously and strongly soon, it will be very difficult to compete with China in the long term," William Matthews, an expert at the UK think tank Chatham House, told Business Insider. He assessed that China is winning the humanoid robot race.