The rapidly expanding humanoid robots sector in China has received a boost from two recent news stories.
First, on May 31, UBTECH, a leader in this field, and Dongfeng Motor, a significant state-run carmaker, inked a deal for Dongfeng Motor to provide the plant in Liuzhou, southwest China, with Walker S humanoids.
These robots will do inspections, fill fluids, and assemble auto parts in place of human workers.
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However, Shenzhen-based UBTECH declined to give data to the media, thus the precise number of Walker S units to be deployed and the locations of the facilities still need to be discovered.
Separately, the robotic division of the massive Chinese internet company Xiaomi Group revealed that it would be moving to the Xiaomi smart vehicle plant, which is located in a vast industrial park in suburban Beijing with a robotics theme.
In a statement, Xiaomi’s robotic subsidiary said that the company intends to introduce its bionic humanoids for use in its manufacturing facilities.
Xiaomi’s robotic products—which include the full-sized humanoid CyberOne and the quadruped CyberDog—will soon move from being specialist robots used for production to generic technology with a wider range of uses.
What is the ground reality behind this hype?
These developments appear positive at first, but a closer look reveals the reality.
Those interested in Chinese humanoid robots may remember that, just three months prior, the renowned Walker S robot from UBTECH visited the plant of NIO, a Chinese electric vehicle manufacturer, to participate in a series of “onsite training” exercises.
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Maybe during the NIO factory warm-up, UBTECH’s robot acquired enough experience to get ready for actual assembly line work. Most likely, the response is negative.
The most recent collaboration with Dongfeng is perhaps a larger-scale pilot project or a reiteration of earlier procedures. It is hard to take it seriously in either case.
While rising sales of consumer-grade and logistics robotics in 2023 made up for declining revenue, UBTECH’s signature product category—smart robotics, which includes its Walker series—remains financially troubled.
Remarkably, in just three years, the company has sold ten Walker robots, bringing in a meager 16 million yuan ($2.21 million) for its total revenue.
It begs the question of how long UBTECH can keep burning money and making losses on its humanoid robots.
Are investors placing bets based on false information?
Many emerging players have rode the wave of humanoid robotics over the last two years.
For instance, Agibot, a humanoid robot developer based in Shanghai, has received a plethora of venture capital and advantageous policies. State-owned enterprises in the area promised to allow Agibot to use their factories for the on-site deployment of its bipeds.
Specialized robots are currently more important in manufacturing than humanoid robots. They have to compete with more affordable robotic alternatives if they are to become flexible assistants.
The financial prospects for humanoids are considerably worse for occupations that require intimate human interaction. The idea of employing robots as butlers, friends, or caregivers seems like a far-fetched dream due to immature technologies.
Home environments also present significant safety problems, which hinder humanoids’ ability to gain traction in the consumer market.
The hefty cost of humanoids—typically between 500,000 and 1 million yuan—is another obstacle. Although supply chain management and cost control are areas in which Chinese enterprises excel, this is because of volume assumption.
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Consequently, it is worthwhile to consider whether these prosperous Chinese robotics companies are indeed financially secure. Can they continue to get investor support to stay in the business despite their audacious predictions?
Why does the humanoid robot industry in China have to improve?
In the future, domestic humanoid robot firms will probably find themselves battling it out in this particular market niche. But oversaturation—that ancient scourge—is all but unavoidable.
Considering this, a large portion of the positive coverage regarding the growth of the Chinese humanoid robot market is marketing speak.
Chinese humanoid roboticists face several challenges in both technology and business, none more difficult than persuading a robot that is now in a prostrate position to lift itself into a standing position.
Threats include a potentially disastrous trade embargo, a dearth of AI expertise, and an unsatisfactory dependence on NVIDIA GPUs and Isaac Lab simulation software.
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In terms of the industry, the next two years will be crucial. Humanoid robots will experience a shakeup if substantial progress is not made and they cannot displace important human jobs. When the capital frenzy fades, stories of robots from UBTECH working in auto manufacturing will just be fluffy puffery that doesn’t solve anything.
