Why China’s humanoid robot industry is winning the early market

Source: TechCrunch

China’s Humanoid‑Robot Surge

China’s humanoid robots grabbed global attention with kung‑fu flips at the nation’s televised Spring Festival Gala, while Chinese phone maker Honor is set to unveil its first humanoid robot at MWC in Spain.

Robotics was flagged as a priority under the country’s “Made in China 2025” plan, originally focused on factory automation rather than humanoids. Rapid advances in multimodal AI are now accelerating embodied AI—autonomous machines operating in the real world—a push officials say could help offset labor shortages and drive productivity gains.

“China has a more robust hardware supply chain — much of it built up through the EV sector, from sensors to batteries — and the world’s strongest manufacturing base, allowing companies to iterate far faster than Western competitors,”
— Selina Xu, China‑AI policy lead, Office of Eric Schmidt, quoted in TechCrunch

Market Snapshot

• Global shipments (2025): 13,317 units (Forbes).
• Growth outlook: Industry expected to nearly double each year, reaching 2.6 million units by 2035.
• Caveat: Numbers mix commercial sales, demo models, and pilot deployments, reflecting the sector’s early stage.

Leading Humanoid Makers (by 2025 shipments)

“More customers are asking: Can the robot run stably in real environments and actually take work off people’s plates? That practical pull is strengthened in China because policy and industrial strategy encourage automation upgrades, and the manufacturing ecosystem makes iteration extremely fast.”
— Yuli Zhao, Chief Strategy Officer, Galbot, TechCrunch interview

From Demo‑Driven Excitement to Operations‑Driven Adoption

• Galbot’s G1 appeared at this year’s Spring Festival Gala alongside robots from Unitree, Noetix, and MagicLab.
• The shift reflects a broader industry move: reliable, repeatable value in production or service operations is now the key adoption driver.

Funding Landscape

U.S. vs. China: Competitive Dynamics

• Speed & Volume: Chinese firms ship roughly 36× more units than U.S. rivals such as Figure and Tesla (per Selina Xu).
• Hardware Supply Chain: China’s EV‑driven ecosystem (sensors, batteries) gives it a decisive edge in rapid iteration.

Outlook & Trends

• Mass‑Market & High‑End Mix: China is targeting affordable models for consumers while expanding into industrial, rehabilitation, and other high‑value applications (TrendForce, Dec 2025).
• Policy Support: Ongoing government incentives continue to accelerate automation upgrades across sectors.

TechCrunch Event (Reference)

Bottlenecks to China’s Dominance

When it comes to AI systems and integrated software, it’s still unclear where Chinese humanoid firms truly stand. The industry is largely betting on vision‑language‑action models and “world models,” but both technologies remain in early stages.

• Hardware leadership: Nvidia currently leads the space with its end‑to‑end humanoid software stack. Consequently, most Chinese humanoid startups are powered by Nvidia’s Orin chips.
• Domestic alternatives: Chinese chipmakers are developing home‑grown solutions, though they have yet to match Nvidia’s maturity.

Core Technical Challenges

1. Predicting the “next physical state”

   • Humanoid robots need foundation models that can anticipate future physical conditions in unpredictable environments—similar to how large language models predict the next word.
   • Unlike LLMs, robots cannot simply scrape the internet for training data.

2. Data scarcity

   • Most companies rely on simulation environments to generate synthetic data.
   • Real‑world data collection remains essential but is limited.

“Because of the data scarcity problem, humanoids are still far away from autonomy. The hardware is currently ahead of the software—the robot body can handle a lot more dexterity today than years ago (though it has reliability issues, as we saw with the robots that broke down at humanoid marathons), but the brain is still nascent,” — Analyst Xu.

Safety and Regulation

• Safety concerns are a major hurdle; a single high‑profile accident could trigger public backlash.
• China is likely weighing rapid deployment against the risk of moving too fast.
• As the industry matures, more regulations are expected.

Market Outlook

Given the lack of data, Zhao believes demand for humanoids will first emerge in relatively contained workplaces:

• Industrial manufacturing
• Warehouse logistics
• Retail

“Early momentum is likely to be in industrial manufacturing, warehouse logistics, and retail, where tasks are repetitive, hours are long, and processes are clear—creating real demand and ideal conditions for humanoid robots to deliver value at scale,” — Zhao.

These sectors provide the repetitive, well‑defined tasks that are ideal for early‑stage humanoid robots to demonstrate value and drive adoption.

Other APAC Players

Humanoid‑robot development is not a two‑country race. Japan’s robotics ecosystem—spanning startups to semiconductor heavyweights—is targeting mass production of humanoids by 2027【[Japan Forward]】. Long a pioneer through projects such as Honda’s ASIMO, Murata Manufacturing’s Murata Boy, and SoftBank Robotics’ Pepper, Japan leans on precision engineering and advanced control. One area unique to this nation: humanoid robots are increasingly used in elder‑care.

“There are three factors likely to drive the adoption of robotics in Japan.
1️⃣ Labor shortage and the desire to depend less on mass immigration.
2️⃣ A cultural view of robots as friends—more Doraemon than Terminator.
3️⃣ Japan’s dominance across many parts of the robotics supply chain.”
— James Riney, CEO of Coral Capital【source】

South Korea (Hyundai Motor & Boston Dynamics)

• New Atlas humanoid announced for factory use by 2028【Hyundai press release】.
• Production goal: up to 30,000 units per year in the U.S.【Bloomberg】.
• Part of Hyundai’s broader AI‑driven robotics push.

China

Government policy, industrial strategy, labor shortages, and private capital are converging to turbo‑charge China’s humanoid‑robotics push.

“China’s leadership is best understood as a speed‑to‑scale advantage,” says Zhao. “The ecosystem here compresses the entire cycle—R&D, supply chain, manufacturing, integration, and customer deployment—into a very tight loop. That means humanoid companies can move from prototype to real‑world deployment faster, learn from real operations, and iterate at a pace that’s difficult to match elsewhere.”

Key Takeaways