What The Hell America!

As viral clips of robots doing flips, kung-fu, and running a marathon rack up views online, U.S. and Chinese firms are locked in a more high-stakes race: deploying humanoid robots as workers in factories, elderly care, and domestic settings. 

Several companies are hoping to begin mass production as early as this year. But escalating trade tensions could derail those efforts. U.S. President Donald Trump has imposed a 145% tariff on most Chinese imports and widened controls on chip exports that Chinese firms rely on. Geopolitical rifts threaten a global supply chain that has underpinned progress on both sides, scientists and analysts tell Rest of World. Americans lead in AI-powered software, while China excels in hardware and cost-efficient manufacturing. 

It is too early to predict which company will pull ahead to commercialize first, but widened chip controls could give American firms an edge in reaching breakthroughs in the development of AI-powered humanoids.

“Countries or companies with stronger AI ecosystems and semiconductor capabilities are indeed better positioned. U.S. firms currently lead in foundation models and hardware design,” Yunzhu Li, an assistant professor in computer science at Columbia University told Rest of World. 

American technology powers the “brain” of most robots with semiconductors and AI models, sectors in which tech giants like Microsoft, Nvidia, and Google remain major players, according to a Morgan Stanley report published in February. Washington’s latest export controls on Nvidia’s H20 chips would cut China off from the most advanced AI chip the company was previously allowed to sell in China. 

But Chinese companies make up 63% of the global humanoid robot supply chain, mostly providing “body” parts such as hardware components, actuators, sensors, and lithium-ion batteries, the Morgan Stanley report said. 

Chinese companies will now become further deprived of access to cutting-edge chips, while hefty tariffs mean American companies will likely struggle to increase production, analysts said. 

“Chinese and U.S. companies will be affected in different ways from supply-demand perspectives, but it’s a lose-lose situation,” said Wei Sun, China-based principal analyst in AI at Counterpoint, a global technology market research firm, told Rest of World. 

Industrial robots are widely used in China, which ranks third globally in adoption. But humanoids — designed to replicate human movement and decision-making — are vastly more complex. Despite rapid development, no company in the world is selling humanoids at scale.  

“The work by nature is much more complicated and requires versatility,” Lily Li, a Beijing-based research manager for emerging technologies at global consulting firm IDC told Rest of World. “The problem with using humanoids in factories is that, in terms of both hardware and software, it is just not there yet.” 

The two countries’ humanoid makers want to ramp up fast. Shanghai-based startup Agibot said it will produce as many as 5,000 humanoids by the end of this year, a sharp increase from the 731 it made as of January 2025. Ubtech, a Hong Kong–listed robotics company, plans to manufacture 1,000 humanoids this year. 

American companies are aiming higher. Figure AI said it will be capable of manufacturing 12,000 units per year. Tesla aims to produce 5,000 Optimus humanoids this year. CEO Elon Musk earlier predicted that humanoid robots will outnumber humans within 20 years but warned last month that Beijing’s export restrictions on rare earth metals could delay Tesla’s production of humanoid robots. 

U.S. tariffs on Chinese imports could also slow this momentum. American companies that rely heavily on Chinese suppliers will likely see production capacity limitations or increased costs, experts told Rest of World.

“[It’s] just like building a phone,” Danfei Xu, an assistant professor at the School of Interactive Computing at Georgia Tech University, told Rest of World. “They’re not super expensive parts, but many, many parts that they put together,” he said, predicting that American companies would struggle to produce all the components efficiently because of the steep tariffs on Chinese parts.  

Chinese firms face different hurdles: lack of access to cutting-edge chips. Most humanoid robots rely on AI to interpret and adapt to surroundings to perform tasks. 

Advanced AI is key to building robots that are capable of making real-time decisions and learning from the world, Columbia University’s Yunzhu Li said. 

Humanoid companies in both countries — including Agibot, Ubtech, Unitree, Figure AI, Boston Dynamics, and Tesla — did not respond to Rest of World’s requests for comment.   

Wang Xingxing, founder of one of China’s best-known humanoid companies Unitree, said, at a conference held by Chinese investment platform Snowball Finance in January,  that the biggest potential hurdle in the industry is chip access. 

“If there are future bottlenecks, the most likely choke point will be chips. Not with chips used in robots but those that are needed to provide computing power to train the robots,” he said.

To offset these challenges, Beijing has thrown in millions in state funding to support a homegrown supply chain. Companies like Baidu and Horizon Robotics are developing algorithms and chips for humanoid robots but are still lagging behind their American counterparts for multiple reasons, including lack of access to advanced chipmaking equipment.

Chinese startups have recently released videos promoting their humanoid robots’ ability to perform factory tasks like lifting boxes and operating tools, but demand for industrial applications remains minimal. Even Unitree sells most of its humanoid robots to higher education institutions purchasing humanoids for research, according to Chinese financial news outlet Caixin. 

On both sides of the Pacific, there is a lot more work to do on the research side, Xu of Georgia Tech University said. 

The current crop of humanoids are in a “primal” stage of development, Xu said, with researchers still figuring out how to train robots to move and pick up things without falling. When it comes to working in place of humans, “that high-level functionality is very important for robotics, but we’re far away in today’s technology.”  

For now, humanoids are mostly seen outside of labs as publicity tools. On the Chinese Xianyu online marketplace, thousands of posts are listing daily humanoid rental prices for as low as $100 a day, while a slew of companies in the U.S. also rent robots for trade shows.  

Zhao Binran, who runs a Shanghai-based marketing company, recently purchased eight Unitree humanoids for 199,000 yuan ($27,540) each, which he rents out for 20,000 yuan ($2,768) a day. His team custom-programs the robots to shake hands and pose for photos at exhibitions and product launches. 

For Zhao, slow mass adoption is keeping his novelty-based business model viable. 

“They are very popular on the internet, but none of the [companies] have mass production capacity,” he said.

Still, Zhao is optimistic. He has placed an order for 30 more humanoids from Unitree, hoping to capitalize on the slow pace of commercial adoption.