The U.S. Robotics Industry Has a Hardware Problem

For years, the United States has been unusually good at making robots intelligent without becoming equally good at making the machines themselves at scale. That imbalance is becoming more consequential as artificial intelligence moves from software into the physical world.

The emerging generation of humanoid, warehouse and industrial robots requires far more than sophisticated algorithms. It needs motors that can deliver precise movement, gear systems that can withstand repeated loads, sensors that can measure position and force, batteries, power electronics and factories capable of assembling all of those components economically.

America has deep strengths in research, software, semiconductor design and venture capital. But its robotics hardware supply chain is comparatively thin. That creates a problem for startups moving from prototypes to commercial production—and potentially a strategic constraint for an industry expected to become an important part of automation.

The missing layer between invention and scale

The United States has a long history of robotics research. Universities, government laboratories and technology companies have produced important advances in perception, control systems, computer vision and machine learning.

But robotics is ultimately a manufacturing business.

A robot cannot be scaled in the same way as software. Every additional machine requires physical components, assembly capacity, quality control, testing and a supply chain capable of delivering thousands or eventually millions of parts with consistent specifications.

A 2025 report from the Information Technology and Innovation Foundation argued that the U.S. had strong robotics innovation but lacked the industrial ecosystem required for large-scale production. It noted that Japan accounted for 46% of global robotics output in 2022, while the U.S. accounted for 5.4% of robotics exports.

The distinction matters because the economics of robotics change dramatically at scale. A component that is inexpensive and readily available for a prototype can become a serious constraint when a company needs tens of thousands of identical units.

China has built the ecosystem America needs

The most important comparison is not simply between American and Chinese robot manufacturers. It is between their surrounding industrial ecosystems.

China's robotics supply chain benefits from its enormous manufacturing base in electric vehicles, electronics, machinery and batteries. Many robotics components overlap with those industries.

Motors, power electronics, batteries, precision machining and sensors can therefore draw upon established suppliers and production techniques. McKinsey describes this adjacency as a significant advantage for China's humanoid-robot industry, particularly in motors, power electronics, batteries and precision components.

This creates a feedback loop. Large manufacturing volumes encourage suppliers to invest in better equipment. Better suppliers reduce component prices. Lower prices encourage more robot manufacturers to experiment. More manufacturers generate additional demand.

The United States has some excellent component companies, but it lacks the same density across the entire stack.

The U.S.-China Economic and Security Review Commission found that China had become increasingly self-sufficient in mid-tier robotics components, although it remained dependent on imports for some advanced technologies. Its assessment illustrates an important point: China's advantage is not that every component is domestically produced, but that its manufacturing ecosystem is deep enough to support rapid scaling.

Actuators are where software meets the physical world

One of the most difficult pieces of the problem is the actuator.

An actuator converts electrical energy into physical movement. In a humanoid robot, dozens of them may be required to control joints with the combination of strength, speed, precision and reliability needed for useful work.

These systems depend on motors, gearboxes, bearings, encoders and control electronics. Small improvements in each component can affect the robot's weight, battery life, cost and performance.

This is why simply designing a clever AI model does not solve the robotics problem.

The machine must physically execute what the model decides.

The challenge becomes even harder when companies attempt to build affordable robots. A premium machine can tolerate expensive components during early development. A commercial robot intended for widespread deployment cannot.

The prototype-to-factory gap

For American robotics startups, the immediate problem is therefore less about whether a robot can be built than whether it can be built repeatedly and economically.

Prototype development often depends on globally available components. Engineers can order small quantities, modify designs and test different configurations.

Mass production is different.

Suppliers must guarantee consistent quality and delivery. Components need to be certified and qualified. Manufacturers need tooling and automated production lines. Companies must maintain inventories and develop alternatives when a supplier fails.

Recent reporting on U.S. robotics startups illustrates how difficult this transition can be. Some companies have relied on Chinese suppliers for components that are difficult or expensive to source domestically, particularly during rapid prototyping.

That can be commercially rational in the short term. It becomes more complicated when geopolitical restrictions, tariffs or national-security considerations affect the availability of those components.

Why investors and policymakers should care

The hardware gap has implications beyond individual robotics companies.

If American robot makers cannot obtain components competitively, more of the economic value created by the industry may accrue to foreign suppliers. That can affect margins, product pricing and the location of future manufacturing investment.

It also changes the investment opportunity.

The obvious beneficiaries of a robotics boom are robot manufacturers and AI companies. But a sustained expansion could create demand for domestic producers of motors, gear systems, sensors, batteries, power electronics, precision bearings and specialized manufacturing equipment.

That makes robotics partly an industrial-policy question.

Yet rebuilding these capabilities will not happen simply by restricting foreign products. Domestic suppliers need predictable demand, capital, skilled workers, engineering expertise and customers willing to commit to production volumes.

The economics must work.

The next bottleneck may be manufacturing

The U.S. robotics industry is unlikely to solve its hardware problem overnight. Building factories and supplier networks takes considerably longer than developing a new software model.

There is also no guarantee that every component needs to be manufactured domestically. Global supply chains can remain economically efficient, provided companies and policymakers are comfortable with the associated dependencies.

The strategic question is therefore more precise: which parts of the robotics supply chain are sufficiently important that excessive dependence creates unacceptable economic or security risks?

The answer could differ between industrial automation, consumer robots, logistics machines and defense applications.

What is becoming clear is that physical AI will test a different aspect of American technological strength. The United States has demonstrated an ability to invent powerful software and attract enormous amounts of capital to emerging technologies. Robotics asks whether those advantages can be connected to factories, suppliers and production systems.

The next phase of the robotics race may therefore be decided less by who can demonstrate the most impressive robot and more by who can build the supply chain behind it.