Chinese automakers are increasingly investing in humanoid robots, following the lead of Tesla CEO Elon Musk’s ambitious Optimus robot project. With advancements in robotics and AI, especially techniques behind large language models, robots are becoming more capable of performing complex tasks across industries. This momentum has spurred Chinese companies such as Xpeng, Chery’s AiMOGA, BYD, Changan, GAC, Li Auto, SAIC, and Seres to develop or prepare for commercial deployment of humanoid robots. Recently, Xpeng’s robotics division secured over $900 million in funding at a valuation exceeding $6.3 billion, marking the largest private financing round in China’s “embodied AI” sector.

Xpeng, led by founder He Xiaopeng and co-president Brian Gu, is particularly aggressive in this space and sees robotics as a way to significantly boost profits beyond the increasingly competitive automotive market. The company invested around $100 million of its own money into the latest funding round for its Iron humanoid robot, which boasts a realistic human-like form for practical applications. Industry analysts note that while Chinese automakers excel in hardware manufacturing, their ability to match Tesla’s AI leadership remains a challenge. Nonetheless, the entry of these automakers into robotics highlights a broader shift in how vehicle makers are diversifying and betting on robot technologies.

The push toward robotics is not unique to China; global players like Hyundai and Mobileye, as well as startups such as Agility Robotics and Apptronik, are racing to commercialize humanoid robots. Hyundai, for example, plans to deploy Boston Dynamics’ Atlas robot in its U.S. factory by 2028, aiming to automate tasks like parts sequencing. Mobileye also made a significant move by acquiring humanoid robot startup Mentee Robotics for $900 million earlier in 2026. Even electric vehicle maker Rivian is venturing into robotics through its Mind Robotics spinout, although its offerings differ from humanoid designs. The global competition underscores robotics as a key frontier for automakers seeking profitable tech innovation.

Tesla’s bet on humanoid robots has catalyzed this wave of investment, with Chinese automakers keen to capture market share and technological advancements in embodied AI. The trend highlights a recognition that profits from traditional car manufacturing are tightening, prompting these companies to explore robotics as a promising growth avenue. The rapid capital inflows and prominent backers like Tencent, Alibaba, and IDG Capital reflect confidence in the intersection of robotics and AI as the next big profit engine for automakers worldwide. As development continues, the industry will closely watch how these robots transition from prototypes to widely deployed commercial machines.