Morgan Stanley raises China humanoid robot shipment forecast as adoption picks up

Morgan Stanley has sharply upgraded its outlook for China’s humanoid robotics market, saying the industry’s transition from demonstration to commercial use is faster than expected.

The Wall Street bank on Tuesday raised its forecast for China’s humanoid robot shipments for the second time this year, expecting 50,000 to be shipped this year, nearly double its previous estimate of 28,000. The bank had already doubled its forecast of 14,000 units in January.

Morgan Stanley predicts China’s humanoid robot market will reach $2 billion this year and grow to $15 billion by 2030. Annual shipments are expected to reach 446,000 units by then. The forecast includes external sales only, excluding those produced for prototypes, pre-order trials or internal use.

“Commercial validation, policy support and supply chain feedback point to faster adoption of humanoids in China,” Morgan Stanley equity analyst Sheng Zhong said in a note Tuesday. he said.

China has stepped up its push to dominate the industry, with a growing number of domestic manufacturers racing to scale production and use robots in real-world environments such as factories, grocery stores and restaurants.

Beijing has also made developing “embodied artificial intelligence” (artificial intelligence embedded in physical systems such as robots) a priority for the next five years, directing local governments to subsidize startups with land and office space, while ordering banks to extend favorable loan terms.

Last year, About 13,000 humanoids have been shipped worldwide, according to research firm Omdia. While Chinese companies were in the top five in terms of shipments, American rival Figure AI ranked seventh and Tesla ranked ninth. Tesla CEO Elon Musk said earlier this year that the company would not begin selling its Optimus humanoid robot to the public. By the end of 2027.

Joe Ngai, senior partner and president of McKinsey Greater China, said humanoid robotics could become the “next big frontier” for investors tracking China’s rapid technology development.

“When you go out [in China]You see all these startups and more advanced companies, all these robots dancing — but the use of robotics on the industrial side is often an under-the-radar story,” Ngai told CNBC’s Elaine Yu on the sidelines of the World Economic Forum’s Annual Meeting in Dalian on Wednesday.

“If you go to any Chinese factory right now, you’ll see more automation and robotics being used than anywhere else in the world,” Ngai added.

Morgan Stanley’s supply chain field research pointed to faster commercialization, citing greater rollout in factory and logistics environments as well as unmanned retail stores and interactive business services.

The bank named Shanghai-listed Leaderdrive as one of the biggest beneficiaries of the hominid boom and raised its 12-month target price to 464 yuan ($68) from 269 yuan. The Suzhou-based company provides precision robotic components to domestic humanoid manufacturers: ubtech and Galbot.

Supported by solid shipments and a strong customer portfolio, Leaderdrive could have a 40% global market share this year and 25% in the long term, Zhong said.

Chinese robot companies are also increasingly aiming to expand abroad.

Seer Intelligent is a robotics company based in Shanghai. Started trading in Hong Kong It has expanded beyond China since 2021, with overseas revenues from more than 65 countries accounting for 18% of its total sales last year, according to Jonathan Fan, the company’s chief operating officer, on Wednesday.

But geopolitical uncertainty and rising trade tensions remain the most significant headwinds, Fan told CNBC’s Emily Chan on Monday. He said the company is focusing on geographic diversification to reduce dependence on a single market and ensure strict compliance with local regulations in each market in which it operates.

Policymakers in Washington have become alarmed by China’s advances in artificial intelligence and the risks of increased reliance on Chinese technology in recent years.

“If Washington treats the contest merely as a race to meet new talent benchmarks, it may be a leader in innovation but lag behind in influencing where and how artificial intelligence is used around the world,” said Suzanne Nossel, Lester Crown senior fellow for U.S. foreign policy and international order at the Chicago Council on Global Affairs. Opinion article published on Foreign Policy This week.

“A sales campaign against the US AI stack will not kick-start adoption fast enough to keep up with China,” he said.

— CNBC’s Evelyn Cheng contributed to this report.