Here's how robots and AI are already reshaping the Chinese economy

A clothing designer reports that he has reduced the time needed to make a sample by more than 70% thanks to artificial intelligence. In the Chinese hinterland, washing machines are churned out under the command of an AI 'factory brain'.

In one of China's largest ports, containers whizz by onself-driving trucks with virtually no workers in sight, while port scheduling is managed by artificial intelligence.

Executives involved in China's efforts liken the future of factories to living organisms that can increasingly think and act for themselves, going beyond the pre-programmed tasks of traditionally automated factories. This could allow the spread of 'dark factories', with operations so automated that work is done around the clock with the lights off.

Progress can never be fast enough for the Communist Party leaders, who fear that China may lose its status as the world's factory. Its population is shrinking, young people are avoiding factory work, and in many countries the push against Chinese exports has intensified.

At the same time, President Trump is pledging to bring back a large number of manufacturing jobs through the tariffs on China.

Artificial intelligence offers a lifeline to avert these risks, helping China produce and ship more products faster, cheaper, and with fewer workers. Although doubts are creeping in globally as to how quickly AI will transform the world, China is not waiting: it wants to implement what is available today faster than the US can, taking advantage of all the benefits.

'Only by proactively embracing change can we remain invincible in this revolution,' Hu Wangming, chairman of one of China's largest steel groups, told state media this year. By the end of last year, his Shanghai-listed Baosteel unit had identified 125 uses for artificial intelligence and is planning 1,000.

 Last year China installed 295,000 industrial robots, almost nine times more than the United States and more than the rest of the world combined, according to the International Federation of Robotics. China's stock of operational robots will exceed two million by 2024, the highest number of any country.

 Of the 131 factories and industrial sites recognised by the World Economic Forum globally for increasing productivity through cutting-edge technologies such as artificial intelligence, 45 are located in mainland China, while three are in the United States. 

In Baosteel's 'dark factory' in Shanghai, for example, a trio of operators sit in front of dozens of screens monitoring real-time updates, according to state media. Artificial intelligence has limited the need for human intervention to once every 30 minutes, compared to once every three minutes, said a deputy director of the site.

For leader Xi Jinping, strong factories are essential for a robust economy, which ultimately increases national power as China challenges the US for global influence. A quarter of China's gross domestic product value added comes from manufacturing, a far higher percentage than the world average.

One risk is that artificial intelligence could destroy more factory jobs than China expects, leaving an excessive number of workers unemployed. But Chinese leaders are betting that the country's shrinkingpopulation, which is expected to fall by 200 million over the next three decades, will compensate for the job cuts in factories, increasing productivity without increasing unemployment.

 The adoption of AI is "a necessary task and not an optional one", Chinese Vice Minister of Industry and Information Technology Zhang Yunming recently stated.

When China started to open up its economy in the late 1970s, it enjoyed an ample supply of cheap labour. Millions of migrant workers left their villages for assembly lines on the coast.

Today, average wages in Chinese factories are much higher than those in countries like India. Many young Chinese are not willing to work in factories. Beijing revealed several years ago that the shortage of skilled labour in key manufacturing sectors could reach 30 million this year.

AI will not solve all of China's economic problems.In areas such as frontier AI technology and chips, China continues to lag behind the United States and many US companies, such as Amazon.com and Walmart, are prioritising automation in a similar way to Chinese companies.

China's advantage lies in the scale of its ambitions, not only in the nation's brainy technology hubs, but also in areas such as Jingzhou, a city of five million people on the Yangtze River. It is home to the main production facilities of Midea, one of the world's largest home appliance manufacturers, competing with Whirlpool and LG Electronics.

Almost a decade ago, Midea clarified its automation ambitions by acquiring control of German robotics specialist Kuka. Today, Kuka's robots in Midea's Jingzhou washing machine factory work under the guidance of what Midea calls an AI 'factory brain', which acts as a kind of central nervous system that manages much of what goes on in the plant.

The computer brain manages 14 virtual agents within the factory that communicate with each other to understand the best way to perform tasks, with orders flowing down to the robots and other machines in the factory's production area. This is a step towards Midea's goal of using artificial intelligence to more fully automate processes in its factories.

"You input all the data and let artificial intelligence solve it," said Xi Wei, director of the Midea Humanoid Robot Innovation Center. With a PhD from the University of Maryland, Xi spent years in Silicon Valley before returning to China to develop advanced robots for Midea.

Coordinating with the factory's brain, Jingzhou's humanoid robots transport moulded components to an inspection station, where a 3D camera performs checks. If a component fails the inspection, the factory's artificial intelligence systems figure out how to solve the problem.

When screws need to be fastened in an assembly line carrying various models of drying machines, the factory brain is able to identify the model so that the robots perform the correct task, offering human-like flexibility and increasing productivity, says the company.

In cases where human intervention is still required, some have been equipped with artificial intelligence goggles capable of reporting common product errors based on inspection history. Processes that used to take 15 minutes can now be done in 30 seconds. 

Demonstrating how the company wants to use technology to increase efficiency, Midea reports that its turnover per employee grew by almost 40 per cent between 2015 and 2024.

 The US, in response, is trying to impede Chinese AI progress through measures such as export controls that block Chinese access to the most advanced chips.

However, the birth of DeepSeek has demonstrated the ability of Chinese engineers to develop AI models. The fact that most Chinese are optimistic about AI allows the government to quickly implement the technology.A survey found that 83% of Chinese respondents believe AI-powered products and services are more beneficial than harmful, twice as many as in the US.

More than 500 miles east of the Midea washing machine factory in Jingzhou, a billionaire down winter jacket manufacturer is using AI to speed up development cycles. After launching a clothing business in the mid-1970s with a sewing team of 11 villagers, today Gao Dekang's Bosideng has an annual turnover almost four times that of Canada Goose, a major western brand. In collaboration with China's prestigious Zhejiang University,Bosideng launched its own artificial intelligence model to conceptualise designs and produce virtual garments. The company, which last year brought to market its first jacket designed by artificial intelligence, claims to have reduced the time it takes to produce a clothing sample to 27 days from 100 days, cutting development costs by 60%.

In addition to DeepSeek, tech giantHuawei is at the centre of China's efforts. The company has launched a family of large language models, dubbed Pangu, named after a character from Chinese mythology of the creation of the world, along with other artificial intelligence services that factories can use to become more dynamic. Huawei engineers collaborated with Conch Group, a giant cement producer in the city of Wuhu, about 200 miles west of Shanghai, whose cement has been used in projects such as the Three Gorges Dam and the Burj Khalifa skyscraper in Dubai. Faced with an abundance of cement production in China, Conch wants to get a leg up on its rivals by rapidly adopting artificial intelligence, including in the production ofclinker, a key ingredient in cement made by heating limestone and other raw materials at high temperatures. C

In a recent visit, workers at Conch's vast clinker plant monitored the AI model as it automatically adjusted production in real time. Conch and Huawei say that thanks to artificial intelligence they are now able to predict clinker strength with more than 85% accuracy, compared to 70% manual estimation.

According to Conch, the use of the artificial intelligence model has led to a one per cent reduction in coal consumption, equivalent to nearly $300,000 in annual savings on a single production line. The company is targeting a 2% reduction by the end of 2026 thanks to AI, which if replicated company-wide could translate into tens of millions of dollars in savings per year.

According to Conch and Huawei, getting to this point was an arduous task that required a considerable amount of trial and error to make the model work. Experience underlines how the capabilities of AI globally remain limited, with impacts that, even in China, will be felt only gradually.

A special priority for Xi was the upgrading of the nation's ports, a crucial step in strengthening China's dominance as a world manufacturing power. The port of Tianjin, among China's largest, has teamed up with Huawei to launch a fleet of unmanned trucks and a system called OptVerse AI Solver, which optimises tens of millions of variables and constraints such as ship arrival times and crane capacity to handle scheduling. According to Huawei, scheduling that used to take 24 hours now takes 10 minutes. 

Last year, the port also launched PortGPT, an artificial intelligence model developed with Huawei, whose ability to analyse videos and images on site could enable it to replace human security officers in the future, a port executive told state media.

Similar stories are happening all over China: according to the World Bank and S&P Global Market Intelligence, half of the world's top 20 ports in terms of ship delivery times are in mainland China, including Tianjin.

Yang Jiemin, vice-president of the state-owned company operating the port, stated that highly automated operations require 60% fewer workers than in traditional ports. This underlines an advantage of Chinese companies in the use of AI over the US: the absence of independent trade unions. For workers, this makes it extremely difficult to organise opposition to AI.

In the US, automation was a major sticking point between port operators and a major dockworkers' union during contract negotiations last year, with Trump backing union workers and questioning the wisdom of port automation. An agreement this year between the International Longshoremen's Association, which represents dockworkers at East and Gulf Coast ports, and a group representing container shipping companies and terminal operators promises that fully automated terminals will not be developed until the agreement expires at the end of 2030. The agreement also prohibits AI for office functions.

Wall Street Journal journalist