Chinese auto parts manufacturer expanding into robotics to invest 1 billion CNY (approximately 148 million USD) in a new factory dedicated to producing essential components for humanoid robots. Despite a general market downturn, the company’s shares experienced an uptick, rising as much as 3.9% during the trading day before closing up 2% at 9.09 CNY (about 1.30 USD). Meanwhile, the broader Shanghai Composite Index declined by 0.6%, as technology stocks continued their downward trend.
Based in Chengdu, the company announced plans yesterday to establish this new facility in Luzhou, Sichuan Province. The plant is expected to have an annual output capacity of five million robotic joint reducers. The company stated that this investment aims to tap into emerging opportunities driven by the rapid growth of the robotics industry. No specific timeline for construction was provided, only noting that the project will take a substantial amount of time to complete.
A reducer is one of the fundamental parts used in a robot’s joints, facilitating precise movements and consistent positional accuracy. It significantly influences a robot’s load capacity, movement precision, and durability. Given its importance and technical complexity, the component represents a sizable portion of manufacturing costs for robots.
Traditionally, the business has focused on producing automotive transmission parts. In September 2024, the company announced a 1 billion CNY investment in Chongqing to develop a plant manufacturing parts for electric vehicles and robots, including robotic reducers. At that time, it emphasized that high-precision robotic reducers were becoming a key part of its strategic long-term growth plan.
The company also clarified that its robotics-related business remains in the early stages of development and does not yet significantly influence its overall financial performance.