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Chinese automakers are following Tesla’s bet that robots are the next big profit machine
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Chinese automakers are aggressively following Tesla's lead in the humanoid robot sector, viewing it as a crucial next profit frontier. Xpeng's robotics division recently secured over $900 million in funding, achieving a valuation exceeding $6.3 billion, marking a record-breaking investment round for China's 'embodied AI' industry. This surge is driven by the belief that AI advancements, particularly from large language models, can finally make versatile, learning-capable robots a commercial reality.
Several major Chinese automotive players have entered the space. Chery's robotics unit, AiMOGA, is reportedly preparing for an IPO, while BYD has unveiled its own humanoid robot named Xiao Di. Other manufacturers including Changan, GAC, Li Auto, SAIC, and Seres are also developing humanoid robot technology, signaling a broad industry commitment.
Xpeng is considered the most Tesla-aligned in its strategy, with founder He Xiaopeng and co-president Brian Gu personally investing about $100 million in the latest funding round. Their focus is on the 'Iron' robot, designed for realistic commercial deployment. Industry analyst Michael Dunne notes that Xpeng's leadership sees robotics as more promising than the razor-thin profit margins currently expected from electric vehicles.
While Chinese automakers possess significant manufacturing advantages for hardware production, the key challenge remains catching up to Tesla on the artificial intelligence front. The race is global, with companies like Agility Robotics, Apptronik, and Figure also pursuing mass commercialization of humanoid robots.
Established players are advancing rapidly. Hyundai's Boston Dynamics plans to deploy its Atlas robot in a Georgia factory this year, targeting full operational use for tasks like parts sequencing by 2028. To accelerate this, Hyundai has partnered with Google's DeepMind and is opening a U.S. Robot Metaplant Application Center to train robots in complex movements.
The competitive landscape is further intensifying with moves like automotive supplier Mobileye acquiring humanoid robot startup Mentee Robotics for $900 million. Even electric vehicle manufacturer Rivian has entered the field through its Mind Robotics spinout. As technology matures, the automotive industry is betting that the factory floor and beyond will be transformed by humanoid robotic labor.
