The Economist: China races ahead in the humanoid arms race

Key topicsChina leads humanoid robot race with tech, state backing, and supply chainsMusk bets big on Tesla bots; forecasts $10trn in future robot salesUS lags in manufacturing as export curbs risk falling further behind.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..From The Economist, published under licence. The original article can be found on www.economist.com© 2025 The Economist Newspaper Limited. All rights reserved..The Economist .And they’re off! Well, some of them. One weak-kneed participant collapsed before the starting line. Another did so a few steps later. A third quickly ran into a railing. Still, the remaining 18 humanoid robots taking part in a Beijing half-marathon on April 19th leapt, skipped or trundled glitchlessly onto a special track in a technology park on the outskirts of the Chinese capital—and into the future. The winner crossed the finishing line in a stately two hours and 40 minutes; five more completed the 21.1km course. Some of the 12,000 human runners (the best of whom covered the distance in just over an hour) looked on, bemusedly.A gimmick? Sure. But also an irresistible—and clearly intentional—metaphor for China’s ambition in the technological contest with America. As far as automatons that look and move like human beings go, it is one that now seems China’s to lose.Fascination with human-like machines predates “robots”, a word coined in a 1920 play by Karel Capek (and which evokes the word for drudgery in his native Czech). Although robotic arms became widespread in manufacturing from the 1960s, it is only now that researchers can recreate human mobility in metal and, thanks to artificial intelligence (AI), human minds in silicon.As a result, humanoid robots are at last beginning to leave the lab and enter the workplace. On April 22nd Elon Musk reasserted during an earnings call that he expects “thousands” of Tesla’s Optimus robots to be working in its electric-car factories by the end of the year. He predicted that the firm would be churning out 1m Optimuses by 2030, maybe even 2029. In January he suggested that they would one day be generating more than $10trn in annual sales for Tesla. “Like it’s really bananas,” he gushed.Wall Street is less fruity in its enthusiasm. But only a touch. Goldman Sachs now forecasts that within a decade the market for humanoid robots could be worth $200bn, up from a bull case in 2023 of $150bn. Citigroup reckons sales may reach $7trn by 2050. Bank of America talks of 3bn humanoids by 2060, or one for every three people, doing everything from handling hazardous materials to caring for the swelling ranks of elderly H. sapiens. All three banks expect China to be at the forefront of the revolution. So does Mr Musk. He told analysts this week that, of course, he expects Tesla to be number one. But, he added, “I’m a little concerned that…ranks two through ten will be Chinese companies.”That concern is justified. Mr Musk knows well what happens when China’s leaders go gaga for an emerging industry. In China and elsewhere Tesla’s electric-vehicle sales are crashing as Chinese challengers, nurtured on state support then left to compete among themselves, offer EVs that are cheaper, better or both..Read more:.Musk: More robotic androids than people by 2040.Now the Communist Party is making a similar song and dance about humanoids, both as a matter of technological pride and, given the shrivelling working-age population, out of demographic necessity. In January robots devised by Unitree, a startup from Hangzhou, literally pranced on stage during the Spring Festival Gala, a televised state-sponsored celebration of the Chinese new year. In a speech last month Li Qiang, China’s premier, name-checked Unitree alongside DeepSeek, the national AI superstar.That is encouraging the private sector to pile in. Unitree’s corporate backers include Meituan, an e-commerce giant. AgiBot, another humanoid startup, has attracted investments by BYD, Tesla’s main EV rival, and Tencent, a vast digital conglomerate. Huawei, China’s mightiest tech titan, is pursuing its own android dreams. UBTech, a rare listed humanoid-maker which went public in 2023 and sells its robots for around $70,000 a pop, expects to ship 500-1,000 of them this year and more than 10,000 in 2027.On top of state support, Chinese robot-makers enjoy another, bigger advantage over rich-world rivals: a well-oiled supply chain. America retains the edge in robot brains, notably in top-notch AI models (OpenAI and Google) and the chips these need to run (Nvidia, which also provides a software platform to program robots). To keep it that way, this month President Donald Trump again tightened curbs on the export of semiconductors to China.But China is catching up fast in machine thinking. DeepSeek has shown that Chinese algorithms are clever and can do without fancy chips (a day after America’s new restrictions came to light Nvidia’s boss, Jensen Huang, flew to Beijing in a show of commitment to Chinese customers). Meanwhile, Chinese firms dominate the manufacture of components for machine bodies. .Androids dream of electric hipsOf the 60 or so listed makers of robotic eyes (ie, cameras and sensors) and hands, muscles and joints (actuators), 48 are Chinese. Their combined market value of $217bn is up by 56% since September, even after the stockmarket rout provoked by Mr Trump’s tariffs. In the past year 12 had sales exceeding $1bn, compared with just two of their dozen non-Chinese rivals. That is not counting CATL, the world’s leading maker of electric stomachs (batteries). Bank of America says this supply chain will help halve the cost of materials in a Chinese humanoid by 2030, to $17,000.What about America? A $20,000 robot replacing the typical American factory worker would pay for itself in less than two months, thinks Citigroup. Sadly for the country’s manufacturers, making the gubbins at scale domestically would be costlier, for it means starting from scratch.This would matter less if Mr Trump were not hacking off allies in Asia and Europe, whose firms already make sundry robotic bits and bobs. The two big non-Chinese parts-suppliers are German (Schaeffler) and Swedish (SKF); Japanese industrial-robot firms like Fanuc make components in-house and could be persuaded to sell them. With their help, America could give Chinese humanoids a run for their money. Alone, it risks being lapped.

The Economist: China races ahead in the humanoid arms race

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From The Economist, published under licence. The original article can be found on www.economist.com

© 2025 The Economist Newspaper Limited. All rights reserved.

The Economist

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