China Chases Tesla to Build Humanoids to Replace Human Workers

Tesla has an early advantage in AI, but China has the power to lower production costs

China is leading the market for electric vehicles. In the competition to create battery-powered humanoids that are likely to replace human workers assembling electric vehicles (EVs) on assembly lines, is now pursuing Tesla (TSLA.O). 

This week, more than two dozen Chinese companies showcased their humanoid robots designed for use in factories and warehouses at the World Robot Conference in Beijing. A further number of them displayed the precision parts manufactured in China that were required to construct the robots.

China is leveraging the strategies that drove its first electric vehicle (EV) push over ten years ago, like a deep supply chain, ruthless pricing competition from new competitors, and government support.
According to analyst Arjen Rao of the China-based LeadLeo Research Institute, the country’s humanoid robot business demonstrates clear advantages in supply-chain integration and mass production capabilities.

Goldman Sachs predicts the global annual market for humanoid robots will reach $38 billion by 2035, with over 1.4 million shipments going to industrial and consumer applications. They are expecting the cost of the materials will roughly fall to about $150,000 by 2023, excluding research and development charges.
Hu company is now working on its fifth version of robot workers for trial in factories, and he expects the sales price to be less than $30,000.

Catfish Effect On Robots

Chinese officials predicted that Tesla, the EV pioneer, would have a catfish effect on the Chinese industry when it launched its Shanghai facility in 2019 since having a competitor would make Chinese rivals swim faster.
Elon Musk, the CEO of the American automaker, initially used Optimus, which it first unveiled in 2021, as potentially more significant than the vehicle business over time.

Musk’s company is optimizing its artificial intelligence strategy based on its “Full Self-Driving” software for electric vehicles. Tesla has an early advantage in AI, but China has the power to lower production costs.
Tesla launched Optimus this week in an exhibition at the conference in Beijing, displaying the mannequin-like standing in a plexiglass box next to a Cybertruck.

Even though Optimus surpassed other Chinese humanoids, who were walking, waving, or even shrugging, it remained one of the most popular displays with tourists taking pictures.
In a statement, Tesla restated its expectation that it will begin making Optimus in small quantities next year, moving past prototypes.

Assembly Line Robots

UBTECH Robotics has also been testing its robots in auto manufacturing. It started with Geely opening a new tab on Thursday, and they announced an agreement to test them at a Chinese Audi plant.
The project manager at UBTECH, Sotirios Stasinopoulos, stated that mass manufacturing is the goal by the end of the upcoming year.

According to him, that would mean up to 1,000 robots employed in manufacturing. It represents the first significant step toward a large-scale deployment.

UBTECH uses Nvidia and opens new tab chips in its robots, although over 90% of the parts come from China.
Most companies outside of China have led the current generation of production robots with the ability to weld and perform other tasks. Examples of these companies include Kuka from Germany, owned by Chinese home appliance manufacturer Midea, Fanuc from Japan, and ABB from Switzerland.

According to the International Federation of Robotics, China has more factory-installed production robots than any other country, more than three times as many as North America.

Last November, the nation announced plans to begin mass-producing humanoid robots by 2025, although on considerably smaller scales than those required to revolutionize the production of electric vehicles.

According to Rao of LeadLeo Research Institute, it will be at least 20 to 30 years before humanoid robots can achieve large-scale commercial applications.