Humanoid robots in China

Investors’ understanding of China’s technological capabilities has evolved considerably in recent years. DeepSeek helped challenge established perceptions of the country’s progress in artificial intelligence. But more broadly across semiconductors, robotics, advanced manufacturing, automation and electric vehicles, Chinese companies are demonstrating an increasing ability not only to innovate, but also to commercialise new technologies at scale. Growing self-sufficiency in critical technologies has encouraged sustained investment across strategic industries, helping to create new technology leaders and strengthen China’s industrial base.

This piece focuses on humanoid robots, one of the most visible examples of what is increasingly described as physical AI or embodied intelligence. Rather than operating solely in the digital world, these systems are designed to perceive their surroundings, make decisions and interact with the physical environment. As such, humanoid robots are moving beyond laboratory demonstrations towards real-world deployment.

Their development provides a useful lens through which to understand both the evolution of AI and the changing nature of China’s technology sector.

Humanoid robots, unlike industrial robots, are designed to mimic humans in both form and function – machines capable of thinking and behaving like a real person. While commonly depicted in movies set in the distant future, significant investment and sooner-than-expected progress in artificial intelligence and hardware engineering have brought us closer to seeing humanoid robots integrated into everyday lives.

With a wide scope of application, humanoid robots have the potential to transform industries, boost productivity, and fundamentally redefine the way we interact with technology.

Humanoid robot development was popularized in 2021 when leading electric vehicle brand Tesla announced development plans for its general-purpose humanoid robot “Optimus”. Just four years later in January 2025, fourteen humanoid robot models from emerging industry leaders proudly stood on the stage at the Consumer Electronics Show (CES) in Las Vegas, the premier global technology trade exhibition. On the same stage, Jensen Huang, CEO of Nvidia, declared that “the ChatGPT moment for general robotics is just around the corner”, predicting Nvidia’s products to power a billion humanoid robots in the coming years¹.

The total addressable market for humanoid robots is projected to reach USD 38 billion by 2035². There is a wide range of potential applications across various fields.

With time, humanoid robots could for example, evolve to perform surgeries with precision. As a first step in this direction, a Korean company has just received FDA approval in the US to use its robots in brain surgery³. In education they could serve as teaching assistants and provide support in classrooms. And in manufacturing, humanoid robots could work alongside people handling tasks that are repetitive, dangerous or require high precision. This is another field where we see further signs of progress – Amazon, the US online retailer has started testing the use of humanoid robots to move boxes and sort packages alongside human employees in distribution warehouses⁴.

And over time, functionalities that address the needs of the mass consumer market, such as a live-in housekeeper or a companion for the elderly, are expected to be to drivers for broader adoption.

While much of the early global attention on humanoid robotics centred on developments in the United States, China is rapidly emerging as a key participant across the broader value chain. Its role extends beyond supplying components such as sensors, actuators, control systems, batteries and semiconductors. Chinese companies are increasingly developing, manufacturing and deploying complete humanoid robots across a growing range of applications.

More importantly, the discussion around humanoid robots is increasingly shifting from innovation to industrialisation. The critical question is no longer whether robots can run, dance or perform backflips. The harder commercial challenge is teaching them to complete the same task safely and reliably thousands of times a day. This is where China’s advantages in engineering talent, manufacturing expertise and supply-chain depth are likely to prove particularly significant.

These strengths are supported by China’s extensive industrial base. Key robotic components such as servomotors, precision gears, sensors and batteries are increasingly sourced domestically, with local content continuing to rise. As a result, Chinese-made humanoid robots are estimated to be at least 20% cheaper than comparable foreign models. China’s leadership in battery production and rare-earth magnets should also provide an additional advantage as the sector moves towards commercialisation.⁴

China’s position is also becoming increasingly visible in production and deployment. Industry estimates suggest that approximately 90% of humanoid robots shipped globally in 2025 were manufactured by Chinese companies.⁴ Chinese firms have begun deploying humanoids in warehouse operations, factory inspection and selected service applications, while public-sector and state-owned enterprise procurement is emerging as an important source of demand.

There are clear parallels with China’s electric vehicle industry. In both sectors, early policy support, sustained investment and manufacturing scale have accelerated the path from innovation to commercialisation. While humanoid robotics remains at a much earlier stage, China’s experience in electric vehicles demonstrates that long-term leadership is often determined not only by technological breakthroughs. Much like electric vehicles a decade ago, the debate is gradually shifting from whether the technology works to how quickly costs can fall and production can scale.

Beyond factories and warehouses, the technology is also becoming increasingly visible in everyday life. For anyone travelling to China, humanoid robots can already be found checking guests into hotels, delivering food in restaurants and performing at major public events. In 2026, a humanoid robot completed the Beijing Humanoid Robot Half Marathon in 50 minutes, compared with 2 hours and 40 minutes for the winning robot just one year earlier.⁵ This highlights the rapid advances in areas such as balance, locomotion and endurance.

In our view, China’s long-term economic objective is to build a future growth model centred on technology-intensive manufacturing, reducing its historical reliance on property and infrastructure. As this transition progresses, it is creating a broader and more dynamic investment universe.

Humanoid robots provide a useful illustration of this shift. While still at an early stage of development, the sector highlights China’s growing strengths in artificial intelligence, advanced manufacturing and industrial scale. Progress is increasingly moving beyond laboratory demonstrations and into real-world applications. Challenges remain around cost, reliability, safety and commercial viability. Nevertheless, the pace of technological progress suggests humanoid robots are moving from technological curiosity towards industrial reality.

For investors, the potential extends well beyond robot manufacturers themselves. Many of the most compelling opportunities may lie in the companies supplying the semiconductors, software, sensors, motion-control systems and precision components that will underpin the next generation of intelligent machines. As with many transformative technologies, some of the largest beneficiaries may ultimately be found deeper within the value chain than in the robots themselves.

¹ Ctech, as of 27 January 2025.
² Barclays Research, AI gets physical: Innovation meets opportunity, 14 January 2026.
³ Figure AI, “F.02 Contributed to the Production of 30,000 Cars at BMW,” 19 November 2025.
⁴ Morgan Stanley Research, “Asia Economics: Humanoids and Robots – The Next Chapter in China’s Dominance in Global Manufacturing”, 4 May 2026.
⁵ Yang Cheng and Li Wei. “Robots Outrun Humans at Marathon.” China Daily, April 19, 2026.
⁶ Zhejiang Shuanghuan Driveline company website, as of 31 July 2026.