In a private meeting on Monday, Commerce Secretary Howard Lutnick reportedly hinted at a potential crackdown on state-subsidized Chinese robotics.
Three anonymous attendees revealed that Lutnick’s department is investigating these imports, suggesting that decisive action may be taken once the review is concluded. The Trump administration is increasingly treating China’s state-backed robotics sector as a national security concern, warning that heavily subsidized Chinese robots could capture global markets before U.S. manufacturers are able to compete effectively, POLITICO reported on Tuesday.
Lutnick’s comments indicate a growing belief within the administration that robotics, not just AI chips, are becoming the next battleground in the technological competition. “We don’t want state subsidized robotics attacking us in America, this is the arms [race] that is coming — robotic arms are coming,” Lutnick said, according to the report.
Executives from companies such as Space Exploration Technologies Corp (NASDAQ:SPCX), Boston Dynamics, JPMorgan Chase (NYSE:JPM), Goldman Sachs (NYSE:GS), Siemens (OTC:SIEGY), and Rockwell Automation (NYSE:ROK) were reportedly present at the meeting to discuss strategies for reversing decades of manufacturing offshoring and rebuilding the industrial base.
Rebuilding U.S. robotics manufacturing will require significant investment, prompting the Defense Department’s Office of Strategic Capital (OSC) to offer low-cost loans that attract private funding. The office is reportedly working on financing packages for robotics firms Foundation Robotics and Standard Bots, though the deals have yet to be finalized.
The Commerce Department did not immediately respond to Benzinga’s request for comments.
China Widens Lead In Humanoid Robots
This development comes amid escalating trade tensions between the U.S. and China. Last week, Beijing imposed export controls on ten U.S. industrial suppliers, including rare earth miners like MP Materials Corp. (NYSE:MP) and USA Rare Earth Inc. (NASDAQ:USAR) and drone manufacturers, in response to the Pentagon’s earlier blacklisting of Alibaba Group Holding Ltd. (NYSE:BABA), Baidu Inc. (NASDAQ:BIDU) and BYD Co.Ltd. (OTC:BYDDY).
Meanwhile, China’s robotics industry has been outpacing its U.S. counterparts. In 2025, China’s Unitree Robotics shipped over 5,000 humanoid robots globally, while Tesla Inc.‘s (NASDAQ:TSLA) Optimus shipped roughly 150 units. China is also competing on price, with Unitree’s robots starting at about $5,900, far below Tesla’s Optimus, which is expected to cost more than $20,000 and potentially over $40,000.
February report suggested that Xpeng Inc. (NYSE:XPEV) is set to begin construction of a 1.18 million-square-foot humanoid robot factory in Guangzhou this quarter and plans to start mass production of its IRON robot by year-end. Positioned as a rival to Tesla’s Optimus, the company aims to produce more than 1 million units by 2030 and deploy the robots in applications such as retail services and tour guiding.
Andrew Kang, CEO of Robo Strategy and a crypto investor, believes humanoid robotics represents the largest investment opportunity since Bitcoin (CRYPTO: BTC), arguing the sector could eventually reach a market capitalization worth tens of trillions of dollars as robots become widely adopted across industries and everyday life. Moreover, the cost of humanoid robots is significantly lower than that of the average American worker, making it a lucrative investment opportunity, he stated.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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