Chinese electric vehicle maker Xpeng expects to produce more than 1,000 humanoid robots a month by the end of 2026 as it competes with Tesla in a high-stakes race to dominate physical AI, the integration of intelligent software into robotics and machinery.
The Guangzhou-based carmaker told the South China Morning Post in a statement on Thursday that its manufacturing capacity would pave the way for the global launch of Iron, its next-generation humanoid robot, with commercial deliveries projected to begin in 2027.
In November, CEO He Xiaopeng, also Xpeng’s co-founder, said the company expected to sell 1 million robots by 2030 as he pledged to lower production costs and make robots more affordable for households.
Xpeng’s Iron runs on the company’s Vision-Language-Action 2.0 AI model. Unlike older systems that translate images into text-based code before executing a movement, the newer model allows the robot’s neural network to convert visual data directly into motion, improving task efficiency and reducing information loss.
“Xpeng is rebuilding its image as a global contender in physical AI, rather than an imitator of Tesla,” said Eric Han, a senior manager at Shanghai consultancy Suolei. “As it starts mass production at the end of this year, Xpeng is likely to take on Tesla’s Optimus because it has yet to be commercialised.”
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The move comes as Tesla also undergoes a structural shift. In January, the company said it was transforming itself from a hardware-centric business into a physical AI firm. CEO Elon Musk announced at the time that Tesla would halt production of its Model S and Model X cars and convert the plant where they were made in Fremont, California, to build humanoid robots. The company has yet to sell its Optimus humanoid robot.