China’s new era of dark factories

Don’t get scared when you hear “dark factories”. In 2025, “dark factories” are less about fear and more about the future. And at the heart of this revolution stands a jaw-dropping marvel: Xiaomi’s fully autonomous factory, producing one smartphone every single second — yes, you read that right.

In 2023, Xiaomi unveiled a sprawling 81,000 square metre autonomous production facility — about the size of 11 soccer fields — that operates 24/7, without a single human on the floor. No lights. No breaks. No shifts. This “dark factory” uses the company’s in-house Hyper Intelligent Manufacturing Platform (HyperIMP), an AI-powered ecosystem where machines don’t just follow orders — they think, adapt, and optimise.

Xiaomi CEO Lei Jun has been quoted as saying that the huge facility, located in the Changping district on the northeast outskirts of Beijing, follows a lab-level smart factory built in 2019 that produced around 1 million phones per year, which handled the entire production of the Xiaomi Mix Fold.

The new facility is described by Jun as a truly automated mass-production factory. It features 11 production lines, able to produce the company’s flagship MIX Fold 4 and the MIX Flip phones at a constant rate of one every few seconds.

The term ‘dark factory’ originates from the fact that these facilities do not require traditional lighting since no humans are on the factory floor. Instead, advanced machines, AI systems, and robotics manage every aspect of production, including assembly, inspection, and logistics. This setup eliminates human error, reduces labour costs, and allows continuous operation without breaks or fatigue.

Traditional automation has its limits. Machines are hard coded to perform one repetitive task. It’s great until... well, something misaligns or a sensor acts up. Then, it’s panic stations until a human engineer steps in. But Xiaomi’s HyperIMP changes the game. Here’s how: Real-time Monitoring: Each machine continuously streams operational data to HyperIMP. Predictive Analytics: The AI identifies anomalies before they snowball into problems. Autonomous Corrections: Minor defects, sensor issues, and operational tweaks? The AI resolves them without any human intervention. In other words, Xiaomi didn’t just teach robots to build — it taught them to think like engineers.

This advanced level of machine autonomy allows Xiaomi’s dark factory to produce a phone every second, achieving an annual production capacity of 10 million high-end smartphones according to Xiaomi’s official data (2023). Sure, cranking out a shiny new phone every second is impressive. But the real headline? China has quietly cracked the code for scalable AI-driven manufacturing. For years, many have stereotyped China’s manufacturing dominance as “cheap labour.” But those days are long gone. China has pivoted to cheap automation, and that’s a whole different beast.

According to the International Federation of Robotics (IFR), China deployed over 290,000 industrial robots in 2023 alone, accounting for nearly 52 per cent of global robot installations. It’s no longer just the “world’s factory”. It’s becoming the world’s smartest factory.

In China, the rise of dark factories powered by automation and artificial intelligence revolutionises manufacturing processes and supports China’s broader environmental goals. Integrating AI and robotics in these factories is expected to enhance energy efficiency significantly. Automation helps streamline operations, reducing the need for human-centric infrastructure like lighting, heating, and break areas, ultimately leading to lower energy consumption. This aligns with China’s carbon neutrality goals for 2060, as automation in industrial settings is a key factor in improving overall energy efficiency across sectors.

Now, here’s the kicker—Manufacturing Labour Cost in China (2023): USD 5.51/hour (source: Statista) Cost of Running an Industrial Robot in China (Estimated): USD 1.60–USD 2.00/hour after amortisation and maintenance. Outcome: It’s now cheaper — and exponentially more efficient — to use robots than humans. And with dark factories like Xiaomi’s, this cost curve is only accelerating.

China’s real strategy isn’t just building phones faster. It’s freeing up human capital. In Xiaomi’s model: Robots take over repetitive assembly lines. Humans are reskilled in R&D, AI training, robot maintenance, and advanced manufacturing design. This aligns with China’s ‘Made in China 2025’ initiative — a national strategy to dominate high-tech industries like AI, robotics, biotech, and green energy.

And it’s already showing! China’s R&D spending surpassed USD 600 billion in 2024 (source: OECD). Chinese companies filed over 1.7 million patents in 2024 — the highest in the world (source: WIPO). The logic is simple: If machines are building, humans can be innovating.

But the question is — is there a darker side to dark factories? Of course, while Xiaomi’s HyperIMP and China’s robot revolution are exciting, they’re not without concerns.

Job displacement is a big one. According to a World Economic Forum report (2024), up to 85 million jobs globally could be displaced by automation by 2025, although 97 million new roles could also emerge in AI, data analysis, and tech fields. Digital Security Risks: Fully autonomous factories are juicy targets for cyberattacks. Dependency on AI: Over-reliance on AI decision-making raises critical ethical and control issues. In short, while dark factories promise unprecedented efficiency, societies will need to balance automation with adaptability.

While automation is eliminating some jobs, it is also creating new opportunities. Roles in AI programming, robotics maintenance, and data analysis are expected to grow. The World Economic Forum forecasts that by 2027, 69 million new jobs will be created in areas like green energy and technology. However, the key challenge is ensuring workers transition into these new roles. This will require significant investments in education and retraining programmes to help workers gain the skills they need for an AI-driven economy.

One of the biggest challenges in this transition is the skills gap. As automation grows, many workers must be retrained for new roles. For instance, jobs that require physical labour will be replaced by machines, while jobs that need creativity, problem-solving, and technical expertise will become more critical. To ensure that workers can succeed, businesses and governments must invest in training programmes to help them acquire these new skills.

Looking ahead, the future of work will likely involve humans and machines working together. Robots and AI will handle repetitive tasks, but humans will still be needed for jobs that require creativity, emotional intelligence, and decision-making. Governments and businesses must focus on education and training programmes that help workers learn to collaborate with AI to ensure a smooth transition to this new way of working. Investing in these programmes ensures that workers are ready for the changes and can thrive in an AI-driven economy.

Xiaomi’s dark factory is a glimpse into tomorrow’s industrial DNA. What used to be labour-driven is now data-driven. This shift isn’t limited to phones — it’s spreading to cars, appliances, chips, and even construction materials. By 2030, McKinsey predicts 30 per cent of all factory tasks globally will be automated, powered heavily by AI. Whether you’re a techie, an entrepreneur, or just someone who likes cool gadgets, understanding the rise of dark factories is key to staying ahead in a world that’s — quite literally — working in the dark.

Views expressed are personal