If you are on the fence about what the impact of AI and robotics is going to be on the supply chain, I highly recommend you take a look at a recent article in the Wall Street Journal on China’s strategy on both.
Gilmore Says.... |
 |
| 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 US. |
 |
What do you say? |
|
| Click here to send us your comments |
| |
|
|
|
The article, written by the Journal’s Brian Stegele, is an eye opening look at what China is already doing – and should serve as a warning shot to US companies and policy-makers. The ramifications of what China is doing are huge for geo-politics and our supply chains.
It starts like this: “Sam Altman wants artificial intelligence to cure cancer. Elon Musk says AI robots will eliminate poverty. China is focused on something more prosaic: making better washing machines.”
It continues: China’s “near-term priority is to shore up its role as the world’s factory floor for decades to come. With exports under threat from rising costs at home and tariffs abroad, that is no longer assured.”
And to get there, it is using AI and robotics to transform every step of making and exporting goods.
Now don’t get me wrong. Many US companies are embarking on similar journeys. But based on this article, I would say its clear China is in the lead.
It cites a number of examples, including these:
A clothing designer reports slashing the time it takes to make a sample by more than 70% with AI. Washing machines in China’s hinterland are being churned out under the command of an AI “factory brain.” At one of China’s biggest ports, shipping containers speed about on self-driving trucks with virtually no workers in sight, while the port’s scheduling is run by AI.
I also found this very interesting: Chinese executives involved these strategies “liken the future of factories to living organisms that can increasingly think and act for themselves, moving beyond the preprogrammed tasks at traditionally-automated factories. It could further enable the spread of “dark factories,” with operations so automated that work happens around the clock with the lights dimmed.”
 China is operating with a sense of urgency. Its leaders fear China could lose its status as the world’s factory floor. Its population is shrinking, young people are avoiding factory jobs, and pushback against Chinese exports has intensified in many countries.
In addition, President Trump is pledging to bring home vast numbers of manufacturing jobs through tariffs on China.
“AI offers a lifeline to head off those risks, by helping China make and ship more stuff faster, cheaper and with fewer workers,” the article notes, adding that “Although some doubts are creeping in globally about how quickly AI will transform the world, China isn’t waiting: It wants to deploy what is available today quicker than the US can, locking in any advantages.”
And consider these numbers: China installed 295,000 industrial robots last year, nearly nine times as many as the US and more than the rest of the world combined, according to the International Federation of Robotics. China’s stock of operational robots surpassed two million in 2024, the most by far of any country.
The article further notes that 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 US.
Only three.
At Chinese steel maker Baosteel’s dark factory in Shanghai, for instance, a trio of operators sits in front of dozens of screens monitoring real-time updates, according to state media. AI has limited the need for human intervention to once every 30 minutes from once every three minutes previously, one report quoted a deputy director of the site as saying.
“Only by proactively embracing change can we remain invincible in this revolution,” Hu Wangming, chairman of Baosteel, told a conference earlier this year, adding that it had found 125 uses for AI by the end of last year - and is planning for 1,000.
I think I will leave it there, finishing up with a Part 2 next week. I will just end with this- those that are optimistic on the net effect of AI on jobs should come back for that.
What is your take on China's AI strategy? Let us know your thoughts at the Feedback button below.
Your Comments/Feedback
|
