No.87
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When talking about automation and AI in China, especially in the context of policy and public attitudes, the details really matter.
For example, we have visited one of the most highly automated EV factories in China: NIO’s F2 plant in Hefei. It has roughly 150 workers per workshop, maybe a bit more on the finishing side. By contrast, the SAIC-GM-Wuling plants in Liuzhou, which we are taking people to this time, are much less automated, with around 500 to 600 workers per workshop. The same was true of the SAIC diesel truck factory we visited.
What was striking in Liuzhou was that the factories were quite direct about why automation had not gone further: jobs. They said their plants were about 60% automated and could relatively easily reach 90%, but doing so would be too disruptive to the local economy. But that is specific to Liuzhou, which is a major manufacturing city with an unusually deep pool of factory labor, something that is actually rare in China today. In Hefei, that was clearly not the case, which helps explain why automation levels were much higher there, and why there is a stronger push for it in some other cities as well.
We heard something similar from autonomous driving companies working on robotaxis. They were also very blunt: the technology is more or less ready, but the pace of rollout will depend heavily on policy. It is obvious that robotaxis could displace a large number of drivers, and maintaining social stability and public acceptance is a core government concern. Drivers, incidentally, are also one of the most networked and protest-capable groups in China.
At the same time, you can already see cleaning robots and delivery robots everywhere, whether bringing food to your table or delivering items to hotel rooms. But as one analyst pointed out to us, most employment is still concentrated in the service sector. That is part of why China’s automation push is more aggressive in manufacturing: labor shortages are more acute there, and the broader employment impact is smaller.
So the main takeaway is that the Chinese government is clearly pushing AI and automation, but not in a uniform way. Generally, the emphasis is much stronger in manufacturing than in services, but the actual pace of deployment varies a lot depending on local labor conditions, the specific job, and concerns about social stability.
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