Xpeng robotics valued at $6.3B as EV makers pivot to humanoids

Chinese electric vehicle makers are pushing into humanoid robotics at a scale that now rivals their core car businesses, as a slowing domestic market and razor-thin margins force a search for new growth narratives. Xpeng's robotics unit raised $900 million last month at a valuation above $6.3 billion — roughly matching the $6.5 billion estimated value of its EV business, according to Citi.

"It's part of a bid to reshape capital valuation narratives," said Kevin Li, associate director at Counterpoint Research. He added that the automakers are also looking to boost the perception that they are tech companies and establish a second growth curve.

Xpeng shares have tumbled more than 45 percent this year, making them the worst performer among major EV players, while BYD shares are down more than 13 percent. The average profit margin in China's vehicle manufacturing sector stood at 1.5 percent in the first half of 2026, according to China Association of Automobile Manufacturers data cited by Counterpoint. Chinese automakers account for more than half of the nearly 20 car companies globally that have entered the humanoid robotics sector through in-house development, investment or incubation as of August.

The diversification comes as China's EV sales head for their worst year since 2021. Xiaomi, Li Auto and Geely are also making moves into robotics, while Nio's venture arm has invested in startups including LimX Dynamics and Acorn Robot, according to PitchBook data.

"Given the slowing growth and weakening profitability in the EV market — particularly domestically — it is a natural strategic move for EV companies to diversify into new applications such as robotics," said Jing Yang, director of Asia-Pacific corporate ratings at Fitch Ratings. "This allows them to pursue alternative growth drivers, achieve economies of scale for shared advanced technologies, and potentially improve profitability over the medium term."

Chinese automakers reuse 85% of EV supply chains for robots

Chinese automakers can reuse a significant portion of their existing supply chains for robots, said Xiaoyi Lei, senior research analyst at Jefferies Hong Kong. Xpeng, for example, can use 85 percent of its motors, chips and smart driving software for humanoids. The robots can then be deployed immediately in the automakers' own stores and factories rather than waiting for consumer adoption.

Xpeng said it plans to begin mass production of its robots by the end of this year, starting in its own stores and business venues, before launching to the broader market in China and overseas next year. Xiaomi, which launched its first electric car in 2024, started testing humanoid robots at its factory this year.

"Chinese players are the ones actually pushing it into daily use," Lei said, noting that in-house deployment makes it easier and cheaper for automakers to collect data — which is critical for humanoid commercialization.

Can humanoid robots find buyers beyond automakers?

Whether humanoid robots can generate demand beyond automakers' own operations remains unresolved. Jefferies has yet to see firm external orders from the automakers it covers or clear guidance on external customers and robotics revenue for next year, Lei said.

Leading humanoid company Unitree saw its shares decline for 12 of 16 sessions since its Shanghai debut last month. Founder Wang Xingxing has cautioned that commercialization could still take years, with the humanoid sector's "ChatGPT" moment likely a decade away.

Reusing car technology for robots may not always be straightforward. "The real challenge is how they are going to make the algorithm and software stack that is used to be applied to the smart driving system also viable to the humanoid scenario, which is more difficult and more challenging," Lei said.

Investors haven't fully embraced the robotics narrative yet — Xpeng shares fell after the $900 million robotics raise last month. But the strategic direction is clear: as EV margins compress and growth slows, China's automakers are betting that humanoid robotics can provide the next leg of growth and the tech-company valuation multiple that has so far eluded them.

This article is for informational purposes only and does not constitute investment advice.