China’s dominance in humanoid artificial intelligence robots is set to deepen over the next three to five years, according to Morgan Stanley, which sees Beijing’s rapid advances in embodied AI outpacing Western efforts.
The bank’s analysts said the U.S. cannot avoid engaging with China in this strategically sensitive sector, even as national security concerns remain a priority.
“In order to diversify U.S. manufacturing away from China, the U.S. will likely need to work with China,” analyst Adam Jonas said in a Wednesday note.
China’s competitive edge lies in its ability to produce at scale. Jonas pointed out that the country is already “well ahead of the West with respect to volume production of AI robots, including humanoids.”
That lead, the analysts said, is “likely to widen over the next 3-5 years before it begins to narrow.”
“A viable U.S.-based, AI-enabled robotics business will rely on China for the foreseeable future,” they added.
Jonas drew parallels with the TikTok deal struck in Madrid, framing it as a template for how future cooperation in autos, robotics and AI could unfold between Washington and Beijing.
“U.S. autonomous vehicle/AI-robot policy is effectively outsourced to Beijing,” the analyst wrote, arguing that faster Chinese moves will likely spur bipartisan support in Washington to foster homegrown capabilities.
China’s position in the global ecosystem is also evident in equity markets. Morgan Stanley’s “Humanoid 100” index of global enablers includes 30 China-based companies.
The analysts suggested that the future may follow a “U.S. brain, China body” model, with American innovation in software and AI paired with Chinese expertise in hardware and manufacturing.
“You can’t keep the world’s best auto product away from the world’s consumer forever,” Jonas said, pointing to China’s low-cost electric vehicles, batteries and motors as examples of globally competitive products.
The analyst concluded that being bullish on both Chinese equities and U.S. onshoring is not mutually exclusive. Instead, competition and selective cooperation are likely to shape the trajectory of humanoid AI development in the years ahead.
Source :
https://www.investing.com/news/stock-market-news/chinas-lead-in-humanoid-ai-robots-set-to-widen-over-next-35-years-ms-4244628
