The US is trying to build the future of robotics — just not the parts that go inside it. Washington has declared humanoid robots a national security priority, but China already dominates the supply chain, the manufacturing base, and increasingly the market. Whoever leads in physical AI leads in the next industrial revolution.
Drone déjà vu: The drone industry cautionary tale looms large here. More than a decade ago, US startups were building drones on shoestring budgets until Chinese drone maker DJI arrived with cheaper, camera-stable models and pushed much of the young industry aside. Washington doesn’t want robotics to suffer the same fate. The FCC now requires new advanced robots sold in the US to be assembled domestically with at least 65% domestic content, rising to 75% by 2029.
- Nearly 90% of humanoid robots sold globally in 2025 were Chinese-made, with Unitree alone shipping 5.5K+ units, far beyond US startup volumes.
- Unitree shares surged 460% on their Shanghai debut, giving the robot maker a ~$51B valuation on just $250M in annual revenue.
America's Robot Startups Are Caught in the Middle
US founders say meeting the 65% domestic-content threshold is nearly impossible right now. Teddy Haggerty, Unitree’s former North American distributor turned robotics founder believes that cutting China out entirely just makes a more expensive product without a viable alternative. Employees at some Silicon Valley firms have even flown robot parts from China to the US in their suitcases to keep development moving.
- Persona AI sources parts from Taiwan, Japan, South Korea, and Italy, but says it still can’t meet FCC domestic-content rules without more US support.
- Florida-based Jabil builds Apptronik’s humanoid robots in Mexico, suggesting the near-term supply chain could span North America rather than the US alone.
The carrot-and-stick problem: The FCC rules protect US robot makers from cheaper Chinese rivals, but the suppliers needed to meet them don’t exist at scale yet. With humanoid robotics still young, the US has a narrow window to build that supply chain without stifling innovation and repeating the drone industry’s collapse. As Michael Perry warned, “You need to provide the carrot as well as the stick. Right now, you're only providing the stick.”
