How China Leveraged US Funding To Turn Robot Dogs Into $9 Billion Business

China's Unitree Robotics – among the world's biggest producers of humanoid and quadruped robots – based designs for its most successful robot dogs on innovations funded by the U.S. military, according to a former U.S. defence technology official and three top researchers involved in the project.

Unitree's $1,600 Go2 model, launched in 2023, helped the company rapidly dominate the global quadruped robot market – its Shanghai IPO has drawn frenzied demand. Another Unitree robot has been shown on Chinese state television, armed and accompanying People's Liberation Army (PLA) troops on an exercise. 

These robots draw on breakthroughs in quadruped movement financed by the U.S. DEVCOM Army Research Laboratory (ARL) and other military programmes, the researchers and the former official told Reuters.

The army-funded project turned into, "basically, the first Unitree robot that had any kind of scale", said Gavin Kenneally, a former University of Pennsylvania researcher involved in the programme.

Ben Katz, who worked at Massachusetts Institute of Technology's Biomimetic Robotics Lab, among a consortium of universities financed by the military programmes, said the dimensions of Unitree's popular Go series were "to the millimetre" almost identical to a groundbreaking robot he helped develop called the Mini Cheetah.

Reuters is the first media outlet to detail connections between Unitree designs and the army programme. 

The episode underscores broader problems with the United States' ability to compete with China's state-directed manufacturing sector in high-tech strategic industries, including those critical to national security. Backed by subsidies, clusters of component factories, and a tolerance for heavy losses, Chinese companies have seized market share across industries such as solar panels, drones, EVs and quantum communications, many of which were first developed in the U.S. with government or military backing.

Kenneally commercialised the U.S. breakthroughs through his company, Ghost Robotics, which supplies U.S. special forces with advanced, ruggedised robots. But compared to Unitree, its production is small and costly.

In June, the Pentagon added Unitree to a list of Chinese military companies, calling it a "contributor to the Chinese defence industrial base". That designation falls short of a sanction but limits the U.S. military's future use of Unitree's technology. Unitree has said its robots are for civilian use. 

Unitree, China's State Council and China's defence ministry did not respond to requests for comment.

Unitree did nothing underhanded in using the U.S. Army research. The programme's findings were published openly to stimulate progress in the field, a common practice.

ARL spokesperson Amanda Ligon said the research "strengthened the broader U.S. robotics ecosystem" and informed subsequent work across government and the private sector.

ARL referred questions about Unitree's commercialisation of the technology to the Pentagon, which declined to comment.

U.S. COMPANIES VS. CHINA INDUSTRIAL POLICY

Unitree sold more than 5,500 humanoids and 18,000 quadrupeds last year, company filings show, and it's now valued at about $9 billion ahead of its stock market debut on Wednesday.

By contrast, no U.S. company has mass-produced such robots, including Elon Musk's Tesla, which has displayed prototypes of its Optimus humanoid for years. On a January earnings call, Musk called China "incredibly good" at scaling production.

Boston Dynamics, the U.S. company whose 2019 canine, Spot, used different technology, recently argued in a Congressional hearing that China's low pricing would drive U.S. firms out of the market.

None of the U.S. robotics researchers who spoke with Reuters advocated for keeping such government-financed research secret. Instead, they said, U.S. policymakers should focus on enabling companies to quickly commercialise such advances to compete with China. 

ARL also said publication was important to scientific and technological advancement.

The U.S. excels in innovation and software development but needs to ensure the capital, industrial base, highly skilled workforce and parts supply chains to scale up breakthroughs, said Vijay Kumar, dean at Penn Engineering. 

For now, U.S. authorities often protect companies with trade restrictions on innovative Chinese products. In July, the Federal Communications Commission banned imports of future models of foreign-made humanoid and quadruped robots, including those from Unitree. China has threatened to retaliate to the FCC ban.

China's Washington embassy said in a statement its companies are making new technologies affordable and accessible internationally. It accused the U.S. of abusing administrative power and of "market distortion and unilateral bullying".

Most of the experts who spoke to Reuters supported the U.S. ban but said the policy is not enough to build an industry to catch up with China.

"This isn't just a competition between U.S. and Chinese robotics companies," said Kenneally, the Ghost Robotics founder. "It's between private U.S. companies and China's coordinated national strategy."

In 2015, Chinese President Xi Jinping set out a 10-year plan to lead industries, including green energy, electric vehicles and robotics. Since then, China has channelled capital into risky bets on low-margin 21st-century advanced manufacturing.

Chinese robot manufacturers' rapid reverse-engineering of products draws on the country's dominance in refining critical minerals needed for magnets in robotics applications and the density of suppliers of motors, gears, 'muscles' known as actuators, and other components clustered near Unitree's base in Hangzhou.

Reyk Knuhtsen, a robotics analyst at SemiAnalysis, called the United States' failure to commercialise domestic research a "dropped ball", citing U.S. venture capital's preference for high-return software startups. It would take more than trade barriers on China to boost robotics manufacturing, he said. 

"This is a very big hill for the U.S. to climb," he said.

The White House did not respond to requests for comment about U.S. industrial policy. An FCC spokesperson said the commission was protecting Americans from foreign threats and preparing the country "to deliver on President Trump's vision to lead the world on the next generation of technologies".

Jaret Riddick, who as a former Army Research Laboratory director oversaw the army-funded robotics project, said it did kick-start the U.S. quadruped industry. But in the end, without support for large-scale production, Unitree in China "just kind of consumed that space".

TEACHING ROBOT DOGS NEW TRICKS

The Army funded the Robotics Collaborative Technology Alliance (RCTA) between 2010 and 2020.

The RCTA gathered government, academic and industry researchers from UPenn, the Massachusetts Institute of Technology (MIT), Boston Dynamics, NASA's Jet Propulsion Laboratory, and other research institutions. The alliance's top commercial partner was General Dynamics Land Systems, the Michigan-based defence manufacturer that makes Abrams M1 tanks.

In 2016, UPenn researchers, including Kenneally, eliminated heavy central gearboxes and placed motors in robots' legs, enhancing the ability to sense and respond to terrain. UPenn's progress built on the MIT lab's work funded by the Defense Advanced Research Projects Agency, DARPA.

In 2019, the MIT lab presented the Mini Cheetah, building on UPenn features with increased strength – and the ability to do backflips.

Months earlier, Katz published his MIT master's thesis, detailing Mini Cheetah's actuators. Within six months, he found Chinese companies manufacturing actuator copies "you could buy on AliExpress," he said, referring to the Chinese online retail giant. 

Unitree had been founded three years before by Wang Xingxing, then 26 years old. In his 2016 master's thesis from Shanghai University, which Reuters reviewed online, Wang cited the work done at MIT, including on earlier iterations of the Cheetah, and set out principles consistent with those developed at the U.S. lab. He acknowledged the lab's "pioneering" contributions.

In his thesis, Wang explored design tweaks to speed up development, saying his findings could have future "defence, security, family and education" applications. He referenced Kenneally's ARL-funded UPenn paper.

On its website, Unitree says the company "independently developed the motors, reducers, controllers, and even some sensors of the quadruped robot".

Katz told Reuters he decided against taking his actuators into production, thinking there would be no market. He said China's ability to move fast had broad benefits: robotics "has advanced a lot because of the availability of actuators".

Joao Ramos, who did research at the same time as Katz at the MIT lab, said Unitree copied the Mini Cheetah shape, structure and design. But he credited the company with doing "proper engineering" to perfect a mass-produced robot.

"The actual practical implementation, bringing it to real life, that's all on them," Ramos said.

GUN-TOTING ROBOT DOGS

Walking robots aren't yet widely deployed on battlefields, but the United States and Chinese militaries have both explored the prospect. In October, another Chinese company's "Robot Wolf" quadrupeds featured in Chinese media coverage of the PLA conducting mock beach landings.

Unitree has said in public statements that its products are intended for civilian use. In 2022, the company signed an open letter along with U.S. companies pledging not to weaponise robots, citing risks of harm and serious ethical issues.

But Chinese state television has featured Unitree's Go2 model robots alongside Chinese troops and a modified version of the firm's B1 series robot firing a mounted assault rifle. 

In September 2023, the U.S. Army secured a federal waiver from laws requiring government agencies to prioritise American-made products in order to purchase two Unitree Go2s, according to procurement records that described the devices as crucial tools in the absence of sufficient commercial quantities of U.S.-produced alternatives "of a satisfactory quality". Reuters could not establish whether the purchases went ahead.

Later that month, U.S. Marines conducted an exercise attaching a rocket launcher to a Go1 to enable remote firing.

Kenneally's Ghost Robotics has shipped about 1,000 of its Vision 60 robots, mostly to military and government customers for surveillance and search applications in harsh environments. The company's first customer was Navy Special Warfare Command, which oversees Navy SEAL teams. 

Some components for the Vision 60s, which sell for upwards of $165,000, are built in China, though the company has sought to move its supply chain. By comparison, Unitree lists its B-series robot, for below $100,000 in the U.S.

Ghost Robotics shifted its motor supply from China to South Korea two years ago, though it still finds it difficult to eliminate Chinese magnets and some metal components, Kenneally said.

The only way to escape China's chokehold on the robotics supply chain, he said, is to secure supplies from other countries that have the manufacturing capacity that the United States lacks. In 2024, South Korea's LIG Defence & Aerospace acquired a 60% stake in Ghost Robotics for $240 million. The company is exploring production in Taiwan, Kenneally said.

"We need to work closely with our allies," he said. "There's absolutely no path forward without them." 

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)