China's AI balance: robots welcome, mass layoffs not

Zhou, a quality inspector at a tech company in Hangzhou, earned 300,000 yuan ($43,900) a year checking LLM responses.

Then AI took over his job.

His employer offered him a worse position with 40 percent less salary. Zhou refused. The company fired him.

Last week, the Hangzhou Intermediate People's Court ruled the termination unlawful. This is already the second ruling of this kind in five months.

What the judges say

In December, a Beijing court ruled the same way for a data mapping employee. AI alone is not sufficient grounds for termination.

The robots take over anyway

At the same time, the State Grid Corporation of China is rolling out exactly what Beijing's industrial policy wants: A $1 billion investment for 8,500 robots in 26 provinces.

• 5,000 robot dogs patrol substations and mountain lines

• 500 humanoids maintain ultra-high-voltage facilities

• 3,000 dual-arm platforms handle coordinated repairs

Delivered by the domestic stack: Unitree, Deep Robotics, AgiBot, UBTech, Fourier.

Beijing plans to have 2.1 million "embodied AI" units in production by 2030.

Dress rehearsal for the rest of the world

China is the first major economy where AI is transforming offices and industry simultaneously.

And the first where politics and courts must tackle the issue while the technology is already running.

Growth is weakening, youth unemployment is high, and Beijing cannot politically afford mass layoffs.

Hangzhou's answer is a fundamental political decision: Whoever replaces an employee with AI bears the costs of the transition. Not the employee.

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INSIDE SHENZHEN

Lately we've been getting more and more messages from you: "I'm in Shenzhen. What should I do there?"

So we took a work day and showed what Shenzhen can actually do in 2026:

• Drone food delivery at Talent Park. KFC lands on the roof about fifteen minutes after ordering.

• Pony AI robotaxi across the city. No driver, the steering wheel turns by itself.

• Inno100, the private showroom where new Chinese hardware is already on the shelf just weeks after launch.

• The 4,000 m² DJI flagship store at OCT Harbor, with a delivery drone that can carry a Labrador.

• The Xiaomi flagship store that sells the track-spec SU7 Ultra right next to the rice cooker.

In 1980, Shenzhen was a fishing village with 30,000 inhabitants. Today, 17.5 million people live here.

5.8% of GDP goes into R&D, the highest rate of all major Chinese cities.

→ The entire tour here as text to save and forward.
→ Watch the vlog on YouTube.

CHART OF THE WEEK 

5 STORIES YOU MISSED LAST WEEK 

🇨🇳 CATL raises $5 billion in Hong Kong, biggest 2026 placement: The world's largest battery maker raised over $5 billion in a Hong Kong follow-on, the biggest HK placement of the year. Proceeds go to global capacity, especially European plants and the sodium-ion ramp in Q4. The stock dropped 8% on the dilution announcement but recovered by the weekend. The placement lifts CATL's cash position above $50 billion and tightens the pressure on BYD and LG Energy to fund the next tech generation even faster.

🇯🇵 Japan burns $34.5 billion in first intervention in nearly two years: On April 30 the yen slid past 160 per dollar, with Japanese government bond yields hitting the highest level in nearly three decades. Hours after a verbal warning from Finance Minister Katayama, the BOJ and MOF stepped in, lifting the yen back to 155.5 within hours. Bloomberg estimates the size at around ¥5.4 trillion ($34.5 billion) in a single day, the first intervention since July 2024. Behind the pressure sits the wide Fed-BOJ rate gap, with Iran oil keeping US inflation hot and Fed cuts off the table. The BOJ talked tough about rate hikes on Tuesday but did not actually raise its policy rate — that gap between rhetoric and action is what pushed the yen past 160.

🇰🇷 Samsung's chip profit jumps 48x to a record Q1: The semiconductor arm posted 53.7 trillion won (~$36 billion) in Q1 operating profit, almost 48 times last year. The entire jump comes out of memory. Samsung is selling HBM into Nvidia's next AI chip generation, and the DRAM shortage keeps prices firm on top of that. The foundry arm keeps burning cash on the 2nm node, but memory margins comfortably absorb it. Korean semis are the only Asia tech segment in 2026 where margins grow faster than units shipped, and Samsung sits on the same trade as SK Hynix.

🇨🇳 China formally kills Meta's $2 billion Manus deal: Four months after the announcement, the foreign-investment security review office under China's NDRC has banned Meta's acquisition of AI agent startup Manus and ordered both sides to withdraw the plan. Manus was founded in Beijing in 2022 by Xiao Hong, moved its headquarters to Singapore in June 2025, and laid off 80 of 120 core technical staff in China. Last valuation: $500 million in an April 2025 Series B led by Benchmark. Practically, unwinding will be hard, since the Manus team already sits inside Meta's Singapore offices and large parts of the tech have been integrated. Strategically the message is clear: "Singapore washing" no longer protects anyone trying to move Chinese AI know-how offshore.

🇨🇳 "China's Nvidia" nearly triples Q1 profit: The Beijing AI chip maker Cambricon pushed Q1 net profit up 185% to 1 billion yuan ($146 million), with revenue up 160% to 2.9 billion yuan. The stock hit its 20% daily limit on April 30 to a record high, lifting the market cap to roughly $105 billion. Operating cash actually came in for the first time in years, instead of just government commitments. Rival Moore Threads also posted its first quarterly profit in parallel. The signal: China's domestic AI chip boom is no longer just policy and subsidy talk, it is starting to ship real revenue, exactly as US restrictions push Nvidia's B300 server price in China up to 7 million yuan ($1 million) per unit.

ALSO LAST WEEK 

SoftBank starts new AI and robotics company called "Roze" and plans a US IPO as soon as 2026. Masayoshi Son is bundling ABB Robotics, data center land, and energy assets from his portfolio into the new entity. Roze is meant to build AI infrastructure faster through robotics and help refinance Son's Stargate and OpenAI commitments above $30 billion.

Alibaba's Damo Academy unveiled "Coca," an AI that beats 10 radiologists at early colorectal cancer detection by 20.4%. On non-contrast CT scans from 27,000 patients, the model hit 86.6% sensitivity and 99.8% specificity and caught five previously missed cases.

China State Grid orders 8,500 robots for $995 million, including 500 humanoids worth 2.5 billion yuan and 5,000 robot dogs. Lead suppliers: Unitree, AgiBot, and UBTech. Target: 80% automation of high-risk grid tasks (substation inspection, live-line work) by 2027.

China is testing a truck-mounted nuclear reactor rated at 10 MW — the world's first vehicle-mobile nuclear power pack. Enough to run a mid-sized AI data center, with decades of runtime and no recharging. Planned use cases: islands, ships, space.

LG Energy Solution wins a 10 trillion won ($7 billion) battery order from BMW. First major BMW supply contract for LGES ever. The Korea-Germany axis in EV batteries is becoming concrete, even as Bavaria pushes European in-house production.

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