China accelerates AI factory revolution to protect status as the world’s manufacturing hub

China is accelerating an enormous, economy-wide push to fuse artificial intelligence with manufacturing in an effort to preserve its position as the world’s factory floor. While Beijing still aims to compete with U.S. tech giants in frontier AI, its near-term priority is industrial survival—boosting output, cutting labour needs, and keeping exports competitive despite rising costs, tariffs and labour shortages.

An eye-opening piece in the Wall Street Journal (gated), in summary here. I’ve bolded a few of the points.

• AI is being deployed aggressively across China’s factories — from clothing design and washing-machine assembly to steelmaking, electronics and cement production.

• Automation is scaling fast: “dark factories,” automated ports and AI-controlled production lines are appearing nationwide.

• China is installing more industrial robots than any country, 295,000 last year, nearly 9× the U.S., and more than the rest of the world combined.

• Of 131 factories and industrial sites recognized by the World Economic Forum globally for lifting productivity through cutting edge technologies such as AI, 45 are in mainland China, while three are in the U.S.

• Labour shortages and rising wages make automation a necessity.

• AI is already boosting productivity: faster design cycles, shorter inspection times, 24/7 unmanned operations and efficiency gains in key industries like steel, cement and home appliances.

• Beijing sees AI-powered manufacturing as strategic, crucial for national competitiveness and resilience amid geopolitical pressure and U.S. tariffs.

• The political environment allows rapid deployment of automation, with minimal union resistance and strong state support.

• China still lags in frontier AI chips, but advantages lie in deployment scale, manufacturing ecosystems and high public acceptance of AI.

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China’s rapid deployment of industrial AI could reshape global supply chains, boosting its manufacturing competitiveness even as Western economies try to reshore production. The scale and speed of China’s automation push may widen cost and productivity gaps with the U.S. and Europe.

This article was written by Eamonn Sheridan at investinglive.com.