News On Japan

Can Japan Revive Its Manufacturing Dominance with Physical AI?

TOKYO - Japanese companies and the government are stepping up efforts to develop domestically produced humanoid robots as Chinese manufacturers dominate the rapidly expanding physical AI market, with Nvidia CEO Jensen Huang predicting that the next industrial revolution will take place in Japan.

Humanoid robots equipped with artificial intelligence, often described as "physical AI," were showcased at an event held in Tokyo in July.

Huang attracted crowds when he appeared at an event hosted by Japanese video game company Sega at an arcade in Tokyo. Visitors held up their smartphones as they waited for the arrival of the head of Nvidia, the U.S. semiconductor company that has driven the global AI boom.

With a market capitalization of about 800 trillion yen, Nvidia has become one of the world’s most influential companies, and Huang’s comments can move global stock markets.

During his visit to Japan last week, Huang appeared on the evening of July 15 at a restaurant in Tokyo’s Kanda district. Holding a drink, he was surrounded by senior executives from some of Japan’s best-known companies, including semiconductor makers Kioxia and Tokyo Electron.

On July 16, Huang attended a Japanese government event aimed at promoting the development of domestically produced AI.

"It is an honor to provide the system for Japan’s first national AI infrastructure," Huang said.

The purpose of Huang’s visit was to advance cooperation with the Japanese government and major companies on the development of AI technology unique to Japan.

"Made in Japan means the highest quality and the highest precision," Huang said. "The era of physical AI has arrived. The next industrial revolution will happen in Japan."

Physical AI combines AI as the "brain" with a robot as the "body," allowing a machine to make decisions and act independently in the physical world. Humanoid robots modeled on the human body have emerged as the clearest symbol of the technology.

The question facing Japan is whether it can develop distinctive humanoid robots capable of competing in the global market.

At a humanoid technology competition held in Tokyo in July, one participant explained that the team had focused on enabling a robot to use tools designed for people to remove snow.

The venue, however, was filled largely with humanoid robots made by Chinese manufacturers.

Among them was Unitree, a company with the world’s leading share in robot development. Unitree moved ahead of rivals by beginning mass production, and trials are now underway in Japan ahead of possible deployment at hospitals and airports.

The company’s rapid growth has been supported by strong backing from the Chinese government.

"The government matched companies developing robots with companies that use them and provided specific directions, which led to rapid development," said Wang Yuqing, Unitree’s head of global business.

Supported by government policies and funding, Chinese companies accounted for about 80% of global humanoid robot shipments in 2025.

China has taken the leading position from Japan in robot development, but Japan once led the world in the field.

About 15 years ago, a robot created in a Waseda University laboratory demonstrated a wide range of facial expressions while imitating an anime character.

Researchers also developed a robot that could play a saxophone in a humanlike manner by using artificial "lungs" to send air through the instrument while moving soft lips and a tongue.

The laboratory of Waseda University professor Atsuo Takanishi, a pioneer in humanoid research, has continued conducting a wide range of studies.

"By creating humanoid robots, we are trying to understand human beings themselves from the perspective of robotics," Takanishi said.

The world’s first major step toward humanoid robot development was taken about half a century ago at what is now Waseda University’s Humanoid Robotics Institute. By 2005, after three decades of development, its robots had acquired smooth movements resembling those of humans.

Despite that early lead, Japan later fell behind in humanoid development.

"One turning point was the emergence of AI several years ago," Takanishi said. "Japan may have had a history of falling one or two steps short and failing to reach practical application."

Japan possessed advanced robotics technology but was unable to connect it to full-scale commercial use. During that period, the global environment changed dramatically.

The United States and China invested heavily in AI development. Equipping humanoid robots with those AI technologies led to major advances in their capabilities.

Humanoids designed to perform tasks in place of people are expected to become a major growth industry. A leading research company forecasts that the market will expand more than ninefold over approximately the next 10 years.

Japan, once the global leader, has now begun a campaign to regain its position.

One possible key to that comeback is the development of robots made entirely in Japan, with government support also beginning to increase.

At a three-year-old startup in Saitama Prefecture, engineers are developing a fully domestically produced robot at a facility converted from a warehouse.

"Nearly all of the parts are made within about a 30-minute drive of this factory in Saitama Prefecture," said Hiroya Masuoka, president of Highlanders.

The startup’s technology attracted the attention of a major automaker. Mitsubishi Motors joined forces with Highlanders in July and became one of the first Japanese companies to begin moving toward mass production of domestically developed humanoid robots.

Source: TBS

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