China is rapidly turning humanoid robots into its next AI growth story, using the same manufacturing playbook that helped it dominate the smartphone and electric vehicle sectors, according to Toss Securities.

In a report titled “Back from Shenzhen” released Wednesday, the brokerage’s research center said robotics is emerging as the next major growth driver for China’s artificial intelligence industry, following a visit to the southern Chinese technology hub.

“Robotics is the sector drawing the most attention as the next stage of the AI industry,” said Lee Young-gon, head of the research center. “Chinese companies are rapidly strengthening their position on the back of their manufacturing capabilities.”

The report argues that China’s edge in humanoid robots lies less in frontier innovation and more in its ability to commercialize technologies at scale. Rather than focusing on technological showcases, Chinese firms are concentrating on lowering production costs, expanding manufacturing capacity and finding real-world applications.

Toss Securities compared the strategy to China’s rise in smartphones and electric vehicles, where local companies leveraged manufacturing efficiency and cost advantages to gain global market share.

As the world’s largest manufacturing base, China also benefits from strong domestic demand for automation, providing a natural market for robotics adoption.

The report cited collaborative robot maker Dobot as an example of a company benefiting from China’s manufacturing ecosystem. It also highlighted growing localization of key components such as reducers and actuators, supported by a robust domestic supply chain that is helping lower costs.

During its Shenzhen visit, the research team observed early commercialization efforts, including a humanoid robot selling popcorn at a shopping mall, highlighting how robots are beginning to move beyond demonstrations into practical service applications.

While the report sees significant long-term potential in robotics, it said China’s broader AI industry remains in the early stages of investment. US, South Korean and Taiwanese companies continue to dominate key AI semiconductor segments such as graphics processing units and high-bandwidth memory, but Chinese firms are strengthening their position in parts of the supply chain, including printed circuit boards and copper-clad laminates.

The report added that US export controls have accelerated China’s push to localize critical technologies and reduce reliance on foreign suppliers.

“Competition in AI will ultimately be decided not by who builds the best model, but by who applies AI across the widest range of industries,” Lee said. “China is building that advantage through its manufacturing base, data resources and platform ecosystem.”

ch0221@heraldcorp.com

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