Chinese electric vehicle manufacturer Xpeng is preparing to produce over 1,000 humanoid robots monthly by the end of 2026, positioning itself as a major competitor to Tesla in the physical AI sector—the integration of intelligent software with robotics and machinery.

The Guangzhou-based company announced to the South China Morning Post on Thursday, July 16th, 2026, that this manufacturing capacity will support the global launch of its next-generation humanoid robot, Iron, with commercial deliveries expected to begin in 2027.

Xpeng’s CEO and co-founder, He Xiaopeng, stated in November 2025 that the company aims to sell 1 million robots by 2030, emphasizing efforts to reduce production costs and make robots more affordable for households.

Iron operates on Xpeng’s Vision-Language-Action 2.0 AI model, which enhances task efficiency by allowing the robot’s neural network to convert visual data directly into motion, unlike older systems that first translate images into text-based code.

Eric Han, a senior manager at Shanghai consultancy Suolei, commented, “Xpeng is rebuilding its image as a global contender in physical AI, rather than an imitator of Tesla. 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.”

In January 2026, Xpeng announced its transformation from a hardware-centric business into a physical AI firm.

Meanwhile, Tesla CEO Elon Musk announced plans to halt production of the Model S and Model X cars and convert the Fremont, California plant to build humanoid robots, signaling Tesla’s own commitment to this emerging market.

Sources

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