Many believe 2025 will be a landmark year for the robotics sector — comparable to the iPhone debut for smartphones or ChatGPT launch for AI — as mass production of robots is expected.

This expectation is a result of breakthroughs in robotics hardware and software technology, as well as the growing willingness of manufacturers to scale up production.

In China the excitement over the potential of humanoid robotics soared following the Lunar New Year, when Unitree Robotics general-purpose robots were seen at the Spring Festival Gala. The robots performed a Chinese folk dance with human dancers in a tightly choreographed dance. They were dressed in traditional floral-patterned jackets and spun red handkerchiefs. Their synchronized movements impressed more than one billion viewers.

This performance marked a pivotal point for China’s robotics sector and embodied intelligent, sparking interest and investment. According to the Shenzhen-based Gaogong Industry Institute consultancy, the sector has seen 27 financing deals totaling 4,45 billion yuan (614 million dollars) in the first two month of 2025. Caixin estimates nearly 5 billion yuan in 2024. This suggests that early 2025 funding is already close to last year’s total.

In the last two years, embodied intelligence has become a popular buzzword in AI circles and investment circles. Unlike traditional industrial robotics, like mechanical arms, embodied intelligent focuses on humanoid-like robots that can adaptively perceive and interact with the environment using human-like forms. These robots are characterized by advanced motor coordination, similar to a cerebellum, and cognitive abilities such as vision, language, and movement. This allows for more natural and versatile interaction. This shift represents an evolution from factory automation to robots that can perform more complex human tasks.

The global buzz around AI-native hardware started with the launch of OpenAI’s ChatGPT 3.0 in late 2022. This increased interest in humanoid robotics. Tu Danning is an investment manager with Taihe Capital. She said that humanoid robotics are complex, imaginative and aligned with people’s future visions. Since 2024, a number of Chinese regions have implemented incentive policies to support AI- and robotics-related industries. The country is aiming to lead the global technology race. Hangzhou, in eastern Zhejiang Province, offers up to five million yuan as rewards and 25% in project funding subsidies. Beijing has set up a 100 billion-yuan government fund to support startup companies. Southern Guangdong Province offers up to 50,000,000 yuan to robotics companies, and 10,000,000 yuan to AI firms. Shenzhen, on the other hand, has set ambitious targets for embodied Intelligence, with a goal of cultivating more than ten companies worth more than 10,000,000 yuan, and achieving an industry scale greater than 100,000,000 yuan before 2027. Shanghai and the southwest Sichuan Province have also introduced supportive policies.

Although China and the United States have been viewed as equals when it comes to AI and robotics, China’s strengths are in large-scale production and software optimization. This gives China an edge in industrializing robots. Duan Bing is a Nomura tech analyst. He said that the U.S. excels at theoretical innovation but China is unmatched when it comes to engineering software algorithms and large-scale production. “Humanoid Robotics perfectly combines both strengths.”

Investment frenzies

Jin Hanmin is vice president at Lighthouse Capital and predicts that the humanoid market will be a “massive” opportunity, potentially 10 times bigger than the new energy vehicle industry. He told Caixin that it is foreseeable that many homes will own two or three humanoid robotics.

Unitree’s Chinese New Year Dance Performance has sparked a surge of investment interest in embodied Intelligence. “Investors flooded into our offices to discuss our projects. Some couldn’t secure a place for roadshows while others issued termsheets after only one meeting,” Jin stated.

Liu Xin is the chief executive officer of Soho Blink. The company was founded in July 2024 and specializes in dexterous robot hands. Liu Xin said that the company had been approached by a variety of investors, both private and government, for a possible partnership. However, it has not yet signed any deal.

In recent months, the sector has seen an influx of funding. AI2 Robotics, LimX Dynamics and others announced on March 6 that they had each secured funding of several hundred millions yuan. Fourier, an humanoid robots developer, closed its Series E round in January with nearly 800 million yuan. MagicLab, which was founded in January 2024 and raised 150 million yuan a month before, is now training its robot MagicBot on factory production lines to perform tasks such as inspection and material handling.

As some robotics startups, some of which are less than two-years-old, race to secure funding and accumulate financial reserves, capital is increasingly flowing to leading players, creating an important “siphon” effect. Ji Kaiming, Vice President of Winsoul Capital told Caixin, that the valuations of some startups have jumped from a few hundreds million yuan up to between 2 billion yuan and 3 billion in just two years.

Ji stated that follow-up funding would likely favor the top companies as the robotics sector faces challenges like a long capital cycles, uncertain technological pathways, and unproven applications. “If the cycle lasts between three and five years, then companies with more financial reserves are better positioned to deal with future uncertainties,” he said.

According to private investors, robotics startups have already begun to separate into tiers according to valuation. Galbot, Unitree and AgiBot are the leaders, with each being valued at over $1 billion. Caixin viewed a fundraising document that showed the two-year old Unitree had raised more than 200 million dollars and shipped thousands of units.

Ji highlighted the shift in robotics investments trends, as early-stage funds have moved from hardware-focused companies like Unitree to specialized technology. “Last Year, Motion Control drove interest in Cerebellum technologies,” he said. This year, large models of vision, motion, and language have shifted the focus to “brain” technologies.

With funding and policy support from regions competing to attract emerging tech companies and drive economic change, robotics startups in China are rapidly expanding. This has spurred the growth of three major industry clusters in the northern Beijing-Tianjin-Hebei region, the eastern Yangtze River Delta, and the southern Pearl River Delta.

Xu Kun is a partner with China Renaissance Holdings Ltd. and he highlighted Beijing’s advantage in large model algorithms thanks to its top universities. The Yangtze River Delta – including Shanghai and Hangzhou – offers a strong base for advanced manufacturing, while the Pearl River Delta uses its thriving automotive and mobile phone industries to create a robust robotics industry. Xu said that this geographic diversity offers Chinese robotics companies strategic flexibility and growth prospects. Leading companies will benefit from the increased support of China’s governments for AI and embodied Intelligence. In the government’s work report for March 2025, embodied Intelligence was listed as one of four future industries, along with biomanufacturing and quantum technology.

Tech titans like Huawei Technologies Co. Ltd. enter the space by launching innovation centres and forming partnerships. Tencent Holdings Ltd. focuses on cloud and big-data, and wants to collaborate with robotics makers rather than compete.

Although big tech companies are yet to fully commit, the impact of their entry could be transformational. Ye Qian is the president of Shoucheng capital. He said that “big tech will be a true variable in this industry.”

Tech advances

Unitree robots demonstrated precise control of complex maneuvers at the Spring Festival Gala. This highlighted the algorithmic control.

Shang Yangxing is the CEO of BridgeDP Robotics. He said that the technical path for robotic motion control is becoming clearer and advancing rapidly. BridgeDP, an expert in artificial cerebellum technology that controls robots’ movements, can program a humanoid robot untuned to walk in less than a week.

Shang stated that standardizing hardware components like joint modules and frames simplifies robot building. To achieve effective interaction with the outside world, AI large models must be integrated.

Figure AI Inc. in the U.S. unveiled Helix in February, a model that can understand language and motion. Robots are able to pick up any item. Chinese robotics firms are developing models similar to the Helix. Shanghai-based startup AgiBot released its general AI model Genie Operator-1 on March 10. It was designed to help humanoid robotics understand human actions, and perform real-world task. The lack of physical data makes it difficult to train these models. Goldman Sachs reports that although large language models are able to benefit from internet data, the data needed for robotic AI, covering force and motion, is still scarce.

In order to address this data deficit, AgiBot established a data collection facility in Shanghai in 2024. The factory, which uses around 100 robots now, collects between 30,000 and 50,000 data points per day. AgiBot released the AgiBotWorld dataset at the end of last year, which included more than 1,000,000 trajectories for 217 tasks in five major scenarios. AgiBot acknowledged that the availability of action-labeled, high-quality data was still limited.

Innovation centres in Shanghai, Beijing and Shenzhen are stepping in to help startups with their data needs. Beijing Innovation Center open-sourced Tiangang – a self developed full-size robot platform – and made it available to research institutions and companies. RoboMind – a dataset of 100,000 real-world data from 279 tasks – was also open-sourced by the end 2024.

Stepping in the real world

With rapid advances in embodied intelligent hardware and software, companies are pushing towards mass production and real applications, fueling the expectation that 2025 will be the pivotal year when humanoid robotics enter mass production.

Elon Musk, CEO of Tesla, announced in January that he aimed to manufacture thousands of Optimus robots by 2025. He also said he would increase production tenfold in 2026 to 50,000-100,000. And further to 500,000-1,000,000 units by 2027.

UBTech Robotics Inc. in China announced that it had received orders for 500 humanoid robotics from automobile companies. It expects to receive 1,000-2,000 orders before 2025. AgiBot announced plans to produce over 1,000 units, and hopes to expand sales up to 3,000-5,000 units by the end 2025. Unitree’s humanoid robotics has already sold more than 1,000 units overseas.

Demand for mass production is closely tied to the deployment of applications. Humanoid robotics are now being used in highly automated factory environments, such as automotive production line, where they perform tasks like assembling screws. UBTech, one of the companies at the forefront of this trend, launched its industrial robot, Walker S1, on October 20, 2024. It is being used for training by various companies including Dongfeng Liuzhou Motors, BYD, and Foxconn. The semi-standardized environments of factories are preferred because they present fewer distractions compared to home or commercial scenarios.

Robotics firms are focusing their efforts on improving the manual capabilities of robots by factory training. SoHo Blink, for example, has introduced robots to Li Auto Inc. factories to improve their dexterity and gain the expertise needed to perform complex tasks. Real-world data collected in these environments is vital for their development.

Despite advancements, the cost of humanoid robotics remains a barrier for replacing human labor. According to Soochow Securities Co. Ltd., currently, a robot costs about 400,000 yuan, and three are needed to perform the same work as one human. The payback period is seven years. In a research note, the brokerage stated that if the price of robots were reduced to 120,000 yuan, a single robot could replace a human-operated workstation. This would reduce the payback period significantly and increase the economic viability.

Unitree has released robots that are priced between 88,000 yuan and 99,000 yuan for both the industrial and consumer market. Tiangong traveler, UBTech’s newest offering, a humanoid robot in life-size, is priced at 299,900 yuan. It is available for pre-order and targets a broader range application scenarios, including retail sites.

The consumer market is dominated by price. Digit, which develops robots with humanlike faces, sells them at 800,000 Yuan. The human-like face costs 200,000 Yuan. According to a source at the company, the company is working to cut costs by optimizing its supply chains. They are aiming to reduce the cost of a silicon face from 2,000 to 200 yuan. This could potentially boost their revenue from millions to more than 100 million yuan per year.

Wei Dehao is the CEO of Xingji Guangnian a startup specializing robotic dexterous arms. He warned against rushing to price wars and suggested that such strategies should be delayed until technology matures.

A multibillion-dollar business

The increasing demand for robots in mass production is driving research and manufacturing investment in upstream sectors. This could create an industry chain worth several hundred billion Yuan.

The market for actuators is expected to grow substantially. These are the vital components that convert energy into motion in Tesla’s robots. According to estimates by Soochow Securities, each robot requires 28 actuators, each of which costs 3,000 yuan. Producing 1 million robots, therefore, would create a market valued at 84 billion yuan. Ningbo Tuopu Group and other key Tesla suppliers, such as Ningbo Tuopu Group which has a Mexican subsidiary, are preparing to meet this demand.

Domestic manufacturers are also making progress in key components, such as reducers. These devices allow robots and their limbs to move with precision. In the past, Japanese firms dominated the manufacture of these devices. Chinese-made reducers have replaced foreign counterparts. The market share of Japanese harmonic reducers has dropped from 42.9% to 41.6% by early 2024. According to Orient Securities Co. Ltd. (19659046), the share of Japanese RV reducers for industrial robots has declined from 55% to 44% by 2023. Soochow Securities predicted that the humanoid robotic industry in 2025 would be similar to the electric vehicle boom of 2014. This would signal a decade-long growth with the advent of domestic mass production.

At the moment, many domestic supply chain companies are still in sample delivery phase and have not yet generated large-scale revenue. Lu said that the technical barriers to humanoid robotic suppliers are lower than those for industrial robots. This aligns future profitability with the automotive industry.

Lu said, “Success depends on optimizing production processes while maintaining profitability despite the competitive pricing.” This article was originally published by

Caixin GlobalThis article is republished with permission.

Reporters: Du Zhihang, Bao Hongyun, Liu Peilin, and Han Wei.

(Header Image: A group humanoid robotics perform at the China Science Fiction Convention in Beijing on March 28, 2025. Zhang Kaixin/VCG)