From toys to EVs, China's factories show scale, speed and, increasingly, smartness

Thanks to AI tools, a smart factory in Qingdao City, Shandong Province, can now make 10 smart refrigerators every minute, showing how technology is speeding up production.

Yin Dongdong, a technician at the factory, told China Media Group that AI recognition has improved gap detection accuracy tenfold – from 0.1 millimeters to 0.01 millimeters. And the production efficiency increased by about 40 percent.

The factory's success is just one example of the rapid growth of China's manufacturing sector, which now supplies a wide range of products to consumers worldwide – from low-cost items like toys and clothing to high-value goods such as electric vehicles and smartphones.

With a total value-added industrial output of 40.5 trillion yuan ($5.65 trillion) in 2024, China's manufacturing industry retained its position as the world's largest by scale for the 15th consecutive year, according to the Ministry of Industry and Information Technology (MIIT).

The ministry also reported that China ranks first globally in the output of more than 220 products, ranging from clothing and footwear to aircraft carriers. Additionally, more than 570 Chinese industrial enterprises have made it into the global top 2,500 companies for R&D investment, accounting for nearly one-fourth of the worldwide total.

In addition, over 570 Chinese industrial enterprises were listed among the world's top 2,500 companies for R&D investment – representing nearly one-fourth of the global total – highlighting the sector's growing focus on innovation and technological advancement.

China has emerged as a global leader in areas such as new energy vehicles, high-speed rail and shipbuilding. 

According to Zhao Yingmin, vice-minister of ecology and environment, China's production and sales of new energy vehicles made up over 60 percent of the global market share in 2024 – the ninth consecutive year the country ranked first – as stated at the COP29 UN climate change conference in November.

When the People's Republic of China was founded in 1949, its industrial sector was relatively underdeveloped, with a focus on processing industries like textiles and mining.

A turning point came with the introduction of the first Five-Year Plan (1953-1957), which included the construction of 156 key industrial projects. These laid the foundation for China's industrialization by establishing essential industries.

Since then, the central government has prioritized science and technology, supported by the national policy of reform and opening up. Together with China's vast population and strong market demand, these efforts have propelled the country's industrial development.

Industrial added value grew from 162.1 billion yuan in 1978 to over 1 trillion yuan in 1992, surpassed 10 trillion yuan in 2007, exceeded 20 trillion yuan in 2012, and reached 40 trillion yuan last year, according to the National Bureau of Statistics.

China's manufacturing added value surpassed that of the United States for the first time in 2010 and made up 30.2 percent of the global total in 2022, as per the World Bank. 

This remarkable rise has earned China the title of the "world's factory."

Focusing on sectors such as information technology, new materials, advanced machinery and robotics, the strategy has brought steady progress in industrial capacity, smart manufacturing, innovation, product quality and branding.

In January 2019, Foxconn's Shenzhen factory was recognized as a "Lighthouse Factory" – a designation by the World Economic Forum for leaders in the Fourth Industrial Revolution.

In September 2021, the Beijing plant of Sany Heavy Industry, a Chinese multinational heavy equipment manufacturer, became the world's first heavy industry enterprise to be certified as a Lighthouse Factory.

As the world's largest pile driver manufacturing plant, the Beijing factory of Sany Heavy Industry increased labor productivity by over 85 percent and shortened the production cycle from 30 days to just seven, leveraging human-machine collaboration, automation, AI and the Internet of Things, among other technologies.

In recent years, China has pushed for breakthroughs in key and core technologies to enhance innovation capabilities across its manufacturing sector. Technologies such as the industrial internet, 5G and AI have been widely applied in manufacturing.

A report by the China Center for Information Industry Development, affiliated with MIIT, showed a steady rise in the innovation index of the country's leading manufacturing enterprises, with an average annual growth rate of 11.6 percent between 2013 and 2023.

In a resolution adopted at the third plenary session of the 20th Central Committee of the Communist Party of China in July 2024, it was stated that China will accelerate new industrialization, foster the growth of advanced manufacturing clusters, and promote a higher-end, smarter and more eco-friendly manufacturing sector.

As of February, China was home to over 30,000 smart factories, with advanced facilities improving production efficiency by more than 22 percent, according to MIIT.

This year marks the final year of China's 14th Five-Year Plan period (2021-2025), and a new development plan for the next five years is set to be formulated.

Huang Qifan, academic advisor to the China Finance 40 Forum, said at the 8th West Lake Conference in May that new quality productive forces will become the most powerful driving force for China's manufacturing sector in the 15th Five-Year Plan period and even in the country's long-term development strategy through 2040.

Wan Zhe, an economic expert and professor at Beijing Normal University, said that to strengthen technological innovation capabilities, China must further enhance independent control over core technologies.

It is necessary to boost the technological content and added value of products to cope with international competition in technology and industrial upgrading, Wan said.

He also stressed the urgency of narrowing the talent gap and addressing regional disparities to advance the development of the high-end manufacturing sector.