As a core component in transmission systems, reducers play a pivotal role in reducing rotational speed and increasing torque. Their technical performance directly determines the operational accuracy and stability of downstream equipment. In the humanoid robotics sector, precision reducers are among the key components, accounting for approximately 16% of the cost structure. The transmission accuracy and reliability of these reducers directly impact the flexibility of humanoid robot movements and their adaptability to various scenarios.
Market demand analysis indicates accelerated global industrialization of humanoid robots, with a projected 10-billion-yuan incremental market by 2030. As domestic policies increasingly support the robotics industry, the imminent mass production of humanoid robots is creating a window of explosive growth for precision reducers.
From a technical perspective, the precision reducer market has long been dominated by foreign enterprises: Harmonic reducers are led by Harmonic Drive with a global market share exceeding 80%; in the RV reducer sector, Japan’s Nabtesco holds over 40% of the market share in China; the precision planetary reducer market is also primarily dominated by Japanese and German manufacturers. This landscape not only highlights the urgency of domestic substitution but also sets a benchmark for domestic manufacturers to achieve technological breakthroughs.
From the perspective of domestic substitution, domestic manufacturers have achieved key breakthroughs in technology and market by 2025: the domestic harmonic reducer market size reached 2.49 billion yuan in 2023, with a compound annual growth rate (CAGR) of 16.54% from 2019 to 2023; the RV reducer market size in China is expected to reach 6 billion yuan by 2025, with domestic manufacturers such as Huan Dong Technology continuously approaching international advanced levels in technical capabilities; the global market size of precision planetary reducers grew from 929 million yuan to 1.376 billion yuan from 2020 to 2024, with a CAGR of 10.32%. Domestic high-end products have reached international advanced levels in key indicators such as transmission accuracy, efficiency, and noise, achieving import substitution in some fields, and the localization rate is gradually increasing.
At this pivotal juncture for the industry, the growing demand for humanoid robots and breakthroughs in domestic reducer technology have created a synergistic effect, propelling the domestic substitution process into a critical phase of implementation and harvest. Against this backdrop, this report provides an in-depth analysis of the growth drivers, technological pathways, and domestic substitution progress in the reducer sector, offering essential insights for industrial research and investment decisions.
Reducer: Core Components in Transmission Field, Market Size Steadily Growing
1.1 The reducer serves dual functions of speed reduction and torque enhancement, with extensive downstream applications.
As the pivotal component connecting power sources to actuating mechanisms, gear reducers function through multi-stage gear meshing to reduce input speed while amplifying output torque, making them indispensable in mechanical transmission systems. Given that most industrial machinery operates under high-load, low-speed conditions where direct prime mover drive is impractical, gear reducers are essential for achieving speed-torque matching. Through precision gear ratio design, they proportionally decrease input speed while proportionally increasing output torque, ensuring optimal alignment between power parameters and load requirements. As the core element of modern mechanical transmission, the performance of gear reducers directly determines the transmission efficiency, operational accuracy, and equipment reliability of power systems. This makes them irreplaceable in critical applications such as automated equipment, construction machinery, and transportation systems.
The market size of China’s reducer industry is showing a steady upward trend, with a long-term growth rate maintained at around 5%. According to data from Rui Guan Consulting, the market size of China’s reducer industry reached 144.7 billion yuan in 2024, and the growth rate has remained within the 5% range in recent years. Influenced by the reduction in domestic labor force and the deepening of population aging, manufacturing enterprises are accelerating the transition to automated production to reduce labor costs and improve production efficiency, which directly drives the demand growth for core components of industrial automation such as reducers. Meanwhile, domestic reducer manufacturers are continuously enhancing the market competitiveness of domestically produced reducers by introducing, digesting, absorbing, and innovating advanced foreign technologies, promoting the process of product localization and substitution, and gradually reducing dependence on foreign technologies.
The downstream applications of reducers cover numerous industries and play a crucial role. With their excellent load-bearing capacity, reliability, durability, and precise control over speed and torque, reducers are key to enhancing the efficiency of entire production systems across various industries. Their downstream applications primarily include lifting and transportation, cement and building materials, robotics, heavy mining, metallurgy, and power generation, among other sectors of the national economy and defense industry. Among these, lifting and transportation, cement and building materials, and robotics are the most core application fields for reducers. With China’s sustained economic growth and the deepening of industrial automation, the gross domestic product and fixed asset investment have been rising year by year. As a key basic component of industrial equipment, the market demand for reducers has also been steadily increasing.
1.2 Reducers can be classified into three categories: general-purpose, special-purpose, and precision.
Reducers are categorized into three main types: general-purpose reducers, specialized reducers, and precision reducers. Generally speaking, general-purpose reducers are widely applicable, specialized reducers are custom-designed for specific needs, while precision reducers focus on delivering high-precision motion control and positioning capabilities.
General-purpose reducers are standard transmission devices primarily designed for medium and small-scale applications. Widely used in industrial gearboxes, conveyor systems, and related sectors, they offer limited control precision, meeting only the basic power transmission needs of most machinery. Leading manufacturers include SEW, Siemens, Guomao Co., Ltd., Ningbo Dongli, Jiangsu Tailong, and Zhongda Lide.
Specialized reducers: Customized speed reduction devices developed according to specific industrial needs, typically in large or extra-large specifications, can be optimized for specific application scenarios or industry requirements to meet higher performance standards and special functional needs, such as wind power generation gearboxes, metallurgical gearboxes, etc. Representative companies include China High-Speed Transmission, Hangchi Forward, Weili Transmission, Zhongchi, Jinlei Co., Ltd., etc.
Precision reducers, featuring low backlash, high accuracy, long service life, and exceptional reliability, are the preferred choice for precision-critical applications such as robotics and high-end machine tools. Leading manufacturers include HAMERNAK, Nabtesco, Lüde Harmonic, and Zhongda Lide.
graph 4
Figure 4: Reducers are classified into general-purpose, specialized, and precision types.
level
characteristic
on behalf of company
general reducer
Primarily designed for small and medium-sized applications, these modular and serialized units are widely applicable across various industries.
SEW, Siemens, Guomao Co., Ltd., Ningbo Dongli, Jiangsu Tailong, Zhongda Lide, and others
special reducer
Specifications are primarily large and extra-large, mostly non-standard and industry-specific products.
China reports on high-speed transmission, Hangchi Forward, Weili Transmission, Heavy Teeth, Jinlei Shares
precision speed reduction device
With low return clearance, high precision, long service life, and reliable stability, it is widely used in high-end fields such as robotics and CNC machine tools.
Hamernak, Nabotsk, Green Harmonics, Zhongda Lide, etc.
Source: Guomao Co., Ltd. prospectus, Wanlian Securities Research Institute
Depending on their structure and transmission methods, precision reducers can be classified into harmonic reducers, RV reducers, and precision planetary reducers.
① Harmonic reducer: Composed of a wave generator, flexible gear, and rigid gear. With advantages such as compact size, lightweight design, high transmission accuracy, smooth operation, and large transmission ratio, it is particularly suitable for industrial robots and humanoid robots in industries like 3C, semiconductors, and medical devices. It is mainly used in components like robotic arms, wrists, and hands. However, its drawbacks include low torque transmission, inefficient power transfer, and limited service life.
② RV Reducer: This two-stage mechanism combines involute planetary gear transmission with cycloidal pinion planetary transmission. Featuring high transmission efficiency, smooth operation, strong load-bearing capacity, excellent rigidity, and superior overload impact resistance, it is widely used in heavy-load components of industrial robots such as bases, arms, and shoulders. However, its drawbacks include complex structure, high manufacturing difficulty, and elevated costs.
③ Precision planetary gear reducer: compact in size, composed of planetary gears, sun gear and internal gear ring, with compact structure, high torque, high efficiency of single-stage transmission, light weight, long life and maintenance-free, etc. It is mostly used in the body rotation joints of robots with low precision requirements. Its limitation is the small range of single-stage transmission ratio.
Figure 5: Comparison of Three Precision Reducers
reducer category
design feature
merit
shortcoming
application area
diagrammatic sketch
harmonic reducer
The main components are the wave generator, flexible cabin and rigid cabin. When the reducer operates, the wave generator undergoes controllable deformation, and the power is transmitted through the meshing of the flexible and rigid cabins.
High transmission accuracy, small weight and volume, smooth operation, large transmission ratio
The torque transfer is relatively small, the transmission efficiency is low, and the service life is limited
Joints in robots with lighter loads, such as the forearm, wrist, and hand, are used in fields like aerospace, precision machining equipment, and medical devices.
RV decelerator
It mainly includes two kinds of transmission devices, which are involute planetary gear transmission and cycloidal pinwheel planetary transmission.
The transmission precision is high, the transmission efficiency is high, the transmission stability is high, the bearing capacity is strong, the rigidity and overload impact performance is good.
Complex structure, difficult to manufacture, high cost, and limited service life
The robot has heavy bases, large joints such as the arm and shoulder
precision planetary reducer
The compact design mainly includes planetary gears, sun gears, and internal gear rings. Precision planetary reducers typically have a single-stage reduction ratio of 10 or less, with the number of reduction stages generally not exceeding three.
Single-stage transmission with 97% efficiency, lightweight design, and a service life of up to 20,000 hours—maintenance-free.
The single-stage transmission has a narrow range of transmission ratios.
Precision transmission systems for mobile robots, new energy equipment, high-end machine tools, and intelligent transportation
Source: Kefeng Intelligence IPO prospectus, Wanlian Securities Research Institute
Figure 6: Comparison of Parameters of Three Precision Reducers
Key indicators
harmonic reducer
RV decelerator
precision planetary reducer
transmission efficiency
＞70%
＞80%
＞95%
transmission accuracy （”）
≤60
≤60
≤180
transmission ratio
30-160
30-192.4
3-512
designed life （h）
＞8,000
＞6,000
＞20,000
torsional stiffness
（N·m/arc min）
1.34-54.09
20-1,176
10-370
rated output torque
（N··m）
6.6-921
101-6,135
40-1,200
noise （db）
≤60
≤70
≤65
temperature rise （℃）
≤40
≤45
≤30
Source: Kefeng Intelligence IPO prospectus, Wanlian Securities Research Institute
Precision reducers are widely used in robots and account for a high proportion.
Precision reducers are the core components of robots, accounting for a significant portion of the cost structure in both industrial and humanoid robots. Their performance directly determines the overall performance of the robot, making quality and performance the primary considerations during selection. Reducers represent a substantial portion of a robot’s total cost. According to data from the China Business Industry Research Institute, they account for 35% of industrial robot costs, making them the highest-cost component. Data from Zhiyan Consulting shows they make up 16% of humanoid robot costs, second only to frameless torque motors, positioning them as a key component in humanoid robots. Despite the downward trend in reducer prices driven by technological advancements and intensified market competition, they remain a crucial part of robot costs. Global reducer manufacturers are continuously driving cost reductions through technological innovation and scaled production.
2.1 Harmonic Reducer: Robot is the core incremental market, Green Harmonic Achieve Breakthrough
The harmonic reducer consists of three key components: a wave generator, a flexible wheel, and a rigid wheel. Through their coordinated operation, this device achieves high reduction ratios and torque output in a compact design. The wave generator drives the rigid wheel’s rotation via the flexible wheel’s elastic deformation, effectively reducing speed while increasing torque. This design makes it particularly suitable for precision control applications and space-constrained environments.
China’s harmonic reducer market is experiencing rapid expansion. These precision-driven components are widely used in precision transmission systems, with applications now extending to robotics, high-end CNC machine tools, semiconductor manufacturing, and medical equipment. Data from the China Business Industry Research Institute shows the market size grew from 1.35 billion yuan in 2019 to 2.49 billion yuan in 2023, achieving a robust 16.54% compound annual growth rate (CAGR). The market is projected to reach 3.32 billion yuan by 2025, with a CAGR of 15.47% during the 2023-2025 period.
The global harmonic reducer market exhibits a “dominant leader” structure, with Lüde Harmonic achieving breakthroughs in domestic production. The competitive landscape remains highly concentrated, with Japanese manufacturer Harmonic Drive holding a leading position with over 80% global sales market share. In China’s 2023 harmonic reducer market, Harmonic Drive and Lüde Harmonic ranked in the first tier, capturing 38.7% and 14.5% of sales market share respectively. Companies like Lai Fu Harmonic, Tongchuan Technology, and Japan’s Shinboshi Technology formed the second tier, holding 9.2%,7.3%, and 6.7% market shares. Technologically, Harmonic Drive maintains industry leadership, while domestic manufacturers like Lüde Harmonic have achieved international advanced levels through technological breakthroughs and production process improvements in reduction ratios, rated torque, transmission efficiency, and precision. This progress has broken foreign manufacturers’ technological monopoly in high-end harmonic reducers, gradually replacing imported brands.
Chart 13: Basic Information of Major Domestic & Overseas Harmonic Reducer Manufacturers
Company Name
Registration Location Main Registration Location Main
Product Categories
Application Fields
Harmonic Drive Systems Inc. (HDSI)
Japan
Harmonic reducers,planetary reducers,actuators,servo drives, etc.
Industrial robot field (represented by multi-joint robots), medical equipment, optical measuring instruments, communication equipment, printing equipment, as well as deep-sea robots, aerospace development, etc.
NIDEC (Japan)
Japan
Motors, fans, blowers, motor controllers, reducers, conveyors, optical equipment, sensors, electronic devices, equipment fixtures, production equipment, etc.
Automotive, home appliances, consumer electronics, robots, logistics, medical & health care, public facilities (transportation, energy, ICT), commerce, entertainment, industry, etc.
Green Harmonic
Suzhou,Jiangsu (China)
Harmonic reducers & metal components, motor-integrated products, hydraulic products
High-end manufacturing fields such as industrial robots, service robots, CNC machine tools, medical devices, semiconductor production equipment, new energy equipment, etc.
Laifubo
Shaoxing,Zhejiang (China)
Harmonic reducers
Industrial robots, service robots, medical equipment, high-precision automation equipment, etc.
2.2 RV Reducer: Japanese Companies Lead the Market, Domestic Substitution Potential Huge
The RV reducer employs a two-stage reduction mechanism, combining a first-stage involute planetary transmission with a second-stage cycloidal planetary transmission. This design delivers exceptional advantages including a wide transmission range and high efficiency. Featuring robust load-bearing capacity and superior rigidity, it serves as an ideal high-performance transmission system, particularly suited for industrial robots, CNC machine tools, and medical diagnostic equipment where transmission efficiency, load-bearing capacity, and precision are critical requirements.
The RV reducer market continues to expand, with China’s market growth rate exceeding the global average. Both the global and China RV reducer markets are showing steady growth, primarily driven by the rapid development of industrial automation and smart manufacturing, especially the widespread application in the field of industrial robots. According to QY Research data, the global RV reducer market size grew from 3.43 billion yuan to 7.51 billion yuan from 2018 to 2023, with a CAGR of 16.97%. According to data from Huajing Industry Research Institute, the China RV reducer market size increased from 1.082 billion yuan to 4.295 billion yuan from 2014 to 2021, with a CAGR of 21.77%, outpacing the global average growth rate. It is projected that the market size will reach 6 billion yuan by 2025. Among these, the high growth rate of China’s RV reducer market from 2014 to 2017 was mainly attributed to the rapid increase in downstream industrial robot installations; the slowdown in industrial robot installation growth from 2018 to 2019 led to stagnation in the RV reducer market size growth; and the renewed acceleration in industrial robot installations from 2020 to 2021 drove a significant surge in RV reducer demand.
Nabtesco maintains a dominant position in the RV reducer market, with domestic substitution efforts gaining significant momentum. In the global RV reducer sector, Japanese manufacturer Nabtesco has consistently held industry leadership. Domestically, Nabtesco dominated the market in 2020 with an absolute 54.80% market share, followed by Sumitomo Heavy Industries (6.60%) and Zhongda Lide (6.16%). From 2021 to 2023, the market landscape underwent notable changes as Huandong Technology demonstrated strong growth, increasing its market share from 5.25% in 2020 to 18.89% in 2023, securing its position as China’s second-largest player. Meanwhile, international manufacturers saw their market shares shrink, with Nabtesco’s share declining from 54.80% to 40.17%. As Huandong Technology progressively replaces Nabtesco’s imports, it has further solidified its leadership in China’s robotic RV reducer market.
2.3 Precision planetary gear reducer: Asia Pacific market as the main market, domestic enterprises accelerate the catch up
Precision planetary reducers, comprising sun gears, planet gears, internal gears, and output shafts, are a type of reducer characterized by high precision, high torque, compact size, and lightweight design. These reducers excel in high torque transmission and low-noise operation, making them indispensable in industrial applications requiring high speed, precision, and heavy loads. They are widely used in fields such as machine tool manufacturing, aerospace, agricultural machinery, and intelligent robotics, serving as a critical component in modern industry.
The global precision planetary reducer market is steadily expanding, with domestic market growth expected to accelerate. Driven by demand in industrial automation, robotics, aerospace, and precision manufacturing, this sector has maintained steady growth in recent years. According to QY Research, the global market is projected to grow from $929 million in 2020 to $1.376 billion in 2024, at a compound annual growth rate (CAGR) of 10.32%. The market is expected to reach $1.471 billion by 2025.
Domestic precision planetary reducers have significant substitution potential. Globally, precision planetary reducer products from countries like Germany and Japan are renowned for their high performance and quality, leading the industry in materials, design standards, quality control, precision, reliability, and service life. They are widely used in high-end fields such as automation equipment, robotics, and precision machine tools. Major manufacturers include Japan’s Shinbaku, Newcat, and Wittenstein. Domestic manufacturers are primarily represented by Kefeng Intelligent and Newcat. In 2023, the top five manufacturers in China’s precision planetary reducer market share were Shinbaku (Japan), Hubei Kefeng (China), Newcat (China), Jingrui Technology (Taiwan, China), and Liming (Taiwan, China), with market shares of 20%,12%,9%,7%, and 5% respectively, achieving a CR5 of 53%. Currently, domestic high-end precision planetary reducers represented by Kefeng Intelligent have approached or reached international leading levels in core performance indicators such as transmission accuracy, transmission efficiency, and noise control, achieving import substitution in some application scenarios and demonstrating competitive advantages in localization. However, compared with international top-tier standards, domestic products still have gaps in service life and production consistency, requiring continuous efforts in technology R&D and process optimization to drive comprehensive performance improvements.
Demand Volume and Technological Breakthrough, Domestic Precision Reducer Enter Critical Development Period
3.1 Mass production of humanoid robots is approaching, opening up the incremental market space for precision reducers
Humanoid robots are poised for remarkable growth, with the market projected to expand rapidly. Their vast potential is fueled by technological advancements, cost reductions, and rising societal demand, enabling widespread applications across industries—from industrial production and home services to elderly care, medical assistance, and educational entertainment. These robots will play an increasingly vital role in delivering support services and enhancing quality of life. According to China Business Industry Research Institute, the global humanoid robot market is expected to exceed $20 billion by 2028, with a compound annual growth rate (CAGR) of 56.99% from 2023 to 2028. As these robots become more intelligent, their long-term market potential will continue to grow exponentially.
Tesla’s humanoid robotics is advancing rapidly, with mass production and commercialization entering the planning phase. The company’s Optimus robot has demonstrated exceptional iteration speed: from announcing the project in August 2021 to unveiling its first-generation prototype in September 2022, and finally launching the second-generation Optimus-Gen2 in December 2023. Hardware upgrades have been implemented, with significant improvements in core joint designs, component engineering, and overall coordination control. These enhancements have dramatically boosted the robot’s flexibility and operational capabilities, showcasing rapid product iteration that enables faster performance improvements and cost reductions in humanoid robotics. Optimus is designed for both industrial and household applications, with the ultimate goal of achieving mass production by 2026 and supplying services to other companies. Industry projections suggest Optimus will enter mass production and external sales by 2026, finding applications across multiple sectors.
Figure AI has secured funding from multiple industry leaders and investors, demonstrating robust growth in both technology and market potential. In early March 2024, the company announced it had raised approximately $675 million from tech giants including Amazon founder Jeff Bezos, NVIDIA, OpenAI, and Microsoft, with its valuation reaching $2.6 billion. Investors also include Intel’s venture capital arm ILG Innotek, Samsung Investment Group, Parkway Venture Capital, Align Ventures, and Moutoujie’s ARK Fund. These investments not only provide financial support but also offer strong endorsement for Figure AI’s technological advancement and market expansion. The Figure 02, launched in August 2024, builds upon the functionality and aesthetics of its predecessor while significantly enhancing robotic performance. Featuring a redesigned exoskeleton structure, the product boasts a more refined and cohesive appearance with smoother curves. Exposed wires and battery packs have been concealed behind metal panels, while edge computing power has been substantially upgraded, enabling the robot to autonomously perform various real-world tasks.
Domestic manufacturers have diversified their layouts, with distinctive product features. In recent years, especially since 2023, participants from various backgrounds have accelerated their entry into the humanoid robot market. Universities, innovation centers, and various enterprises have all made strategic moves, leading to a high frequency of new humanoid robot product launches. Robot manufacturers such as Ubtech, Yushu, and Fourier, innovation centers like the Beijing Humanoid Robot Innovation Center and Zhejiang Humanoid Robot Innovation Center, universities such as the Robotics Laboratory of China University of Science and Technology and the Institute of Automation of the Chinese Academy of Sciences, as well as automotive manufacturers like XPeng and Chery, and internet-backed companies like Xiaomi and Zhiyuan, have all introduced humanoid robot products. Currently, domestic humanoid robot products each have their own unique characteristics, demonstrating strong competitiveness in key product features such as intelligence and motion control, and rapidly advancing the mass production process. By 2025, the humanoid robot industry will enter a new phase of development, marked by the finalization of solutions and the realization of small-scale production. The finalization of solutions indicates that product design and functionality will stabilize, preparing for large-scale production, while small-scale production signifies the transition of humanoid robots from laboratories to broader commercial applications, meeting market demands and achieving industrial breakthroughs.
The mass production of humanoid robots is imminent, with differing selection strategies for precision reducers in their applications. Tesla’s Optimus humanoid robot employs a harmonic reducer system, while some domestic manufacturers adopt either harmonic reducers or precision planetary reducers. Harmonic reducers offer compact size and high precision but come with higher costs. The hybrid solution combining harmonic reducers and precision planetary reducers provides superior rigidity and cost efficiency, though it results in larger dimensions and weight. Hardware costs remain a critical factor in the commercialization of humanoid robots, where the hybrid approach demonstrates cost advantages.
Market analysis of humanoid robot precision reducers indicates this emerging sector could generate hundreds of billions in incremental revenue. Current manufacturers employ diverse technical approaches: Tesla utilizes 14 harmonic reducers, Fourier employs 32 planetary reducers, while the Yuanzheng A2 model combines planetary and harmonic reducers without specifying exact numbers. As humanoid robots enter mass production, economies of scale are expected to drive price reductions in precision reducers. Based on Tesla’s Optimus and domestic humanoid robot configurations, a single humanoid robot typically requires 30 precision reducers. Harmonic reducers are prioritized for high-precision areas like shoulders and wrists, with planetary reducers dominating waist and hip joints, accounting for approximately 60% of the total. Projections for 2030 shipments under conservative (500,000 units), neutral (1 million units), and optimistic (1.5 million units) scenarios suggest incremental market growth of 12.6-28.8 billion yuan for precision reducers, with harmonic reducers contributing 9-21.6 billion yuan and planetary reducers 3.6-7.2 billion yuan respectively.
Table 29: 2030 Global Market Size Forecast for Precision Reducers in Humanoid Robots
Category
Conservative
Neutral
Optimistic
Humanoid robot shipments (10k units)
50
100
150
Harmonic reducer demand per unit (units/unit)
18
18
18
Total demand for harmonic reducers (10k units)
900
1800
2700
Harmonic reducer price (yuan/unit)
1000
900
800
Harmonic reducer market size (100 million yuan)
90
162
216
Precision planetary reducer demand per unit (units/unit)
12
12
12
otal demand for precision planetary reducers (10k units)
600
1200
1800
Precision planetary reducer price (yuan/unit)
600
500
400
Precision planetary reducer market size (100 million yuan)
36
60
72
Total market size of precision reducers for humanoid robots (100 million yuan)
126
222
288
Data sources: Harmonic Drive prospectus, STAR Market prospectus, Wanlian Securities Research Institute
3.2 Industrial robot development drives the growth of reducer demand, with China’s installation volume accounting for a prominent proportion
The demand for industrial robot applications in the downstream market is steadily increasing, driving the growth of upstream harmonic reducers and RV reducers. In recent years, the global industrial robot market has shown positive development trends in terms of installation volume, technological innovation, application expansion, and market expectations. According to IFR data, the global industrial robot installation volume in 2024 was 542,000 units, with a compound annual growth rate (CAGR) of 4.44% from 2017 to 2024. In 2021, the installation volume growth rate was notably high due to the rapid growth of the new energy vehicle and consumer electronics industries. The top five regions for global industrial robot installations in 2024 were China, Japan, the United States, South Korea, and Germany. As the world’s largest industrial robot market, China has played a significant role in driving the global robotics industry. With the continuous advancement of high-end manufacturing, the “machine replacing human” trend will continue to benefit, and the certainty of growth in the reducer market is expected to further strengthen in the coming years.
China, as the world’s largest industrial robot market, has provided strong momentum for the domestic substitution of reducers. The automotive and electronics industries are the main demand sectors for industrial robots. China is not only the world’s largest automotive market and production base but also holds a key position in core production fields such as electronic equipment, batteries, semiconductors, and microchips, which contributes to China becoming the world’s largest industrial robot market. Driven by the continuous introduction of industrial support policies and the growing market demand, the installation volume of industrial robots in China has become increasingly significant globally. According to IFR statistics, the installation volume of industrial robots in China increased from 15,000 units in 2010 to 295,000 units in 2024, with a compound annual growth rate (CAGR) of 23.71% from 2010 to 2024; the proportion of installation volume also rose from 12.4% in 2010 to 54.43% in 2023. Currently, the annual installation volume of industrial robots in China has exceeded the sum of all other countries, making it the world’s largest industrial robot market. This market position has accelerated the domestic substitution process of reducers.
3.3 Domestic precision reducer manufacturers are making continuous technological breakthroughs, accelerating the process of domestic substitution.
Foreign precision reducer enterprises have long dominated the market, creating an urgent demand for domestic alternatives. For years, international companies such as Harmonic Drive and Nabtesco have established a leading position in the high-end precision reducer market, particularly in the fields of harmonic reducers and RV reducers, thanks to their long-term technological accumulation and stable product quality. At the same time, they have built long-term and stable partnerships with major global industrial robot manufacturers like ABB, Fanuc, KUKA, and Yaskawa, further solidifying their industry leadership. In contrast, China’s precision reducer industry started later and faces the dual challenges of foreign brands dominating market share and lagging product technology. However, the high prices and long delivery cycles of foreign precision reducers have become significant constraints on the development of China’s industrial robot industry. Therefore, promoting the localization of precision reducers and breaking foreign technological monopolies have become urgent tasks for the development of China’s high-end equipment manufacturing industry. With the continuous improvement of domestic enterprises’ independent R&D and production capabilities, it is expected that domestically produced precision reducers will gradually expand their market share, effectively reduce costs and shorten delivery cycles, providing strong support for the overall development of China’s industrial robot industry.
Industrial support policies have been introduced in a dense manner, and the localization process is steadily advancing. The development of reducers is closely linked to the high-end manufacturing industry. To promote the modernization and industrial upgrading of China, the state and relevant authorities have issued a series of supportive and guiding policies aimed at driving reducer technology toward higher precision, higher performance, and higher energy efficiency, encouraging domestic substitution, and reducing reliance on imported products. In recent years, government authorities have introduced a series of industrial policies to encourage the development of the precision reducer industry, such as the “14th Five-Year Plan for Intelligent Manufacturing Development” and the “Implementation Opinions on Enhancing Manufacturing Reliability.” These policies encourage enterprises to improve the quality and production capacity of precision reducers, overcome technical challenges, and thereby enhance the intelligent level of domestic equipment manufacturing. With the promulgation and implementation of a series of industrial incentive policies, China has listed the breakthrough of core robot technologies as one of the key strategies for national scientific and technological development, and the support for the precision reducer industry continues to increase. In the future, driven by policy support and continuous technological breakthroughs in domestic precision reducers, the localization degree will accelerate, and it is expected to form a market landscape where domestic brand reducers can compete with international brands.
Chart 34: Relevant Policies in China’s Reducer Industry in Recent Years
time
Publisher
Policy Name
primary coverage
December 2021
The Ministry of Industry and Information Technology and seven other departments
The 14th Five-Year Plan for the Development of Intelligent Manufacturing
We will vigorously develop intelligent manufacturing equipment, including micro/nano displacement sensors, flexible tactile sensors, high-resolution vision sensors, online component detection instruments, advanced controllers, high-precision servo drive systems, high-performance and reliable reducers, wearable human-machine interaction devices, industrial field positioning equipment, and intelligent CNC systems.
June 2023
Five departments including the Ministry of Industry and Information Technology
Implementation Opinions on Improving Reliability of Manufacturing Industry
The reliability of key special basic components such as precision reducer, intelligent controller, instrument control parts, sensor, source parts, detector, sample preprocessor, high-end bearing, precision gear, high strength fastener and high performance seal for industrial robot, and general basic parts are improved.
August 2023
The Ministry of Industry and Information Technology and three other departments
Implementation Plan for the New Industry Standardization Pilot Project (2023-2035)
In the key component system, the motor controller, reducer assembly and other drive motor system standards are developed.
September 2023
The Ministry of Industry and Information Technology and six other departments
Work Plan for Steady Growth of Machinery Industry (2023-2024)
We will accelerate the construction of major projects outlined in the 14th Five-Year Plan, including intelligent manufacturing and robotics, major technical equipment, new energy vehicles and intelligent connected vehicles, agricultural machinery, high-end medical equipment, and innovative drugs, while continuously expanding demand for industrial machinery, instruments, pharmaceutical equipment, and industrial robots.
December 2023
National Development and Reform Commission
Catalogue for Guiding Industrial Restructuring (2024 Edition)
The catalogue is composed of three categories: encouraged, restricted and eliminated. In the encouraged category, it proposes to promote the development of key transmission parts, such as rotary kilns, ball bearings, vertical mills, roller presses and other special reducers for cement industry, as well as high-precision reducers for industrial robots.
Source: Chinese Government Website, Wanlian Securities Research Institute
3.4 Investment and Development Recommendations
Precision reducers, as core components of robotics, are poised to unlock a multi-billion-dollar market by 2030 as humanoid robots from Tesla, Figure, Yushu Technology, and Zhiyuan Robotics enter mass production. The harmonic reducer segment stands out as the most promising, with the strongest growth momentum. Meanwhile, domestic manufacturers are making breakthroughs in precision reducer technology, accelerating the substitution of foreign products. Leading Chinese firms in this field are well-positioned to capitalize on these opportunities. Investors should focus on top domestic players specializing in harmonic reducers and precision planetary reducers, which are poised to integrate into major humanoid robot supply chains.
Furthermore, to advance domestic production, we must prioritize breakthroughs in core technologies and overcome critical ‘bottleneck’ challenges.
To strengthen foundational R&D investments, we encourage enterprises, universities, and research institutions to jointly establish R&D platforms. The focus will be on overcoming core technologies such as advanced materials (e.g., high-end gear steel and flexible materials), precision machining processes (e.g., forming techniques for harmonic reducer flexible wheels and grinding techniques for RV reducer cycloidal wheels), and transmission design (e.g., low-return-gap and high-efficiency structures). This initiative aims to narrow the gap with global industry leaders like Harmonic Drive and Nabtesco in terms of precision, lifespan, and reliability. For instance, companies such as Green Harmonic and Ring Motion Technology are supported to sustain R&D investments, pushing the performance limits of harmonic and RV reducers.
To address emerging demands like humanoid robots, we proactively invest in lightweight and highly integrated reducers. Meanwhile, we strengthen patent portfolios to mitigate international infringement risks and build technological barriers through independent innovation.
3.5 Risk Warning
1) Risk of intensified market competition: As the humanoid robot market expands, the precision reducer industry may see more new entrants. Meanwhile, the global industry leader, which holds a dominant position, might adopt aggressive strategies against competitors. This could lead to fiercer competition, potentially reducing corporate profitability due to price wars.
2) Risk of underperformance in humanoid robotics: Currently in the early stages of development, humanoid robots face significant uncertainties. Should future performance fall short of expectations, this could adversely affect the overall demand for precision reducers, a core component of these robots.
3) Risk of underperformance in industrial robot demand growth: Should downstream sectors like automotive and 3C (consumer electronics) fail to meet expected demand growth, this could adversely affect the future performance of precision reducer manufacturers.
4) Risks of domestic precision reducer replacement falling short of expectations: Currently, Chinese manufacturers of precision reducers still lag significantly behind foreign industry leaders in technology. Without technological breakthroughs, the domestic substitution process may fall short of expectations, potentially impacting the performance growth of domestic precision reducer enterprises.
