Copying the electric vehicle explosion curve? Bank of America: "Robot Era" Chinese manufacturing is key, costs may drop by 70% within five years

As global tech giants such as Tesla, NVIDIA, and Meta are betting on humanoid robots, China has also listed humanoid robots as a key national development direction.

In a research report on the 7th, the Bank of America analyst team led by Ming Hsun Lee boldly predicts that humanoid robots are about to leave the concept verification stage and will usher in an explosion of applications across multiple industries within the next decade. It is expected that by 2030, global annual sales of humanoid robots will reach 1 million units, and by 2060, the total ownership of humanoid robots will reach 3 billion units, equivalent to an average of 0.3 robots per person at that time.

But the question arises, who will dominate this "robot revolution"? The answer may be surprising; Bank of America believes that China's strong supply chain capabilities will be key to reducing costs and accelerating adoption.

Bank of America analysis points out that, taking Tesla's Optimus Gen 2 as an example, the current hardware cost of the robot is about $50,000 to $60,000 per unit. However, if most of the hardware is produced in China, by 2030, the cost will drop by 70% to $17,000 per unit. The cost advantage of "Made in China" can be evidenced by the explosive growth in the electric vehicle market.

"Made in China" has a cost advantage and may replicate the miracle of electric vehicle penetration

Cost is a key factor limiting the popularity of humanoid robots.

Bank of America analysis indicates that the material cost of Tesla's Optimus Gen 2 robot is currently about $50,000 to $60,000. However, supply chain surveys show that if the main hardware is produced in China, by the end of 2025, the material cost of humanoid robots could drop to $35,000, and by 2030, it will further decrease by 70% to $17,000. This means that between 2025 and 2030, the average selling price (ASP) of humanoid robots will decline at a compound annual growth rate of 14%.

Bank of America believes that the explosive growth of China's electric vehicle market can serve as a reference. From 2013 to 2023, the compound annual growth rate of passenger electric vehicle sales in China reached 90%, while the price compound annual growth rate of the best-selling pure electric vehicle models in China decreased by 9%.

Between 2020 and 2024, the cost of electric vehicle components in China decreased by 40%-50%, driving the penetration rate of passenger electric vehicles in China from 6% in 2020 to 45% in 2024. If more robot original equipment manufacturers (OEMs) can fully leverage the Chinese supply chain, the global adoption rate of humanoid robots may significantly accelerate

"Similar to the Chinese electric vehicle market, we believe that once more components are commercialized and put into mass production, the penetration rate of humanoid robots will rise rapidly."

In the field of industrial robots, countries like Japan, Germany, and Switzerland have long held a technological lead. However, in the field of humanoid robots, the United States and China have shown a more aggressive posture. American companies such as NVIDIA and Tesla have advantages in artificial intelligence, chips, software, and algorithms. Chinese companies excel in the development of artificial intelligence algorithms and have a strong supply chain, enabling them to provide high-quality components at lower costs.

Chinese component suppliers play a key role in the rapid development of humanoid robots, thanks to their pioneering position in the humanoid robot supply chain and lower production costs. This includes ball screw/roller screw manufacturers like Hiwin Technologies. Bank of America points out that Hiwin Technologies is a leading manufacturer of drive components, including ball screws, linear guides, and harmonic reducers. Currently, it is expanding its influence in the robotics industry and has supplied key components to a leading overseas humanoid robot original equipment manufacturer.

Strong Growth in Humanoid Robot Shipments Over the Next Decade

Bank of America expects strong growth in humanoid robot shipments over the next decade, driven mainly by:

(1) Aging population and labor shortages leading to increased end-user demand;

(2) Technological advancements (especially in artificial intelligence and motion control) and improvements in product design;

(3) Decrease in bill of materials costs;

(4) Expansion of end-user applications.

The research report predicts that global humanoid robot shipments will reach 18,000 units by 2025. By 2030 and 2035, global annual shipments of humanoid robots are expected to reach 1 million units (previously forecasted at 400,000 units) and 10 million units, representing a compound annual growth rate of 88% from 2025 to 2035. Bank of America holds an optimistic view on the long-term demand for humanoid robots as they begin to be adopted on a large scale in household and service applications.

Bank of America also conducted a detailed analysis of the cost structure of humanoid robot components. It is expected that by 2030, actuators will account for more than 50% of total material costs, followed by dexterous hands and visual and other sensing systems.