Shanghai is strategically positioning itself to become a global leader in smart manufacturing by significantly enhancing the integration of Artificial Intelligence (AI) with its industrial sector. This initiative, detailed in a plan released on August 19, 2025, by key municipal commissions, aims to drive new industrialization and boost productivity.
The city has set ambitious targets, including the adoption of intelligent applications by 3,000 manufacturing enterprises, the development of 10 industry benchmark models, and the creation of 100 flagship intelligent products. Additionally, Shanghai plans to foster 100 demonstration application scenarios and establish approximately 10 "AI + Manufacturing" demonstration factories, while cultivating a cadre of comprehensive service providers to build a robust smart manufacturing ecosystem.
Industry leaders recognize the substantial opportunities within this framework. Xie Haiqiu, Deputy General Manager of Haier Group's industrial internet platform COSMOPlat, highlighted prospects in new factory construction, product intelligence upgrades, and collaborative industrial ecosystem development. The plan encourages the creation of "AI + Manufacturing" factories that leverage advanced technologies for more efficient production and promotes the integration of AI into daily operations to enhance product intelligence and functionality.
Shanghai's existing strengths provide a strong foundation for this ambitious plan. As a national science and technology innovation center, the city holds leading positions in sectors such as aerospace, aviation, and high-end equipment. Its robust AI research capabilities, substantial talent pool, and prominent institutions create a fertile ground for innovation. Duan Mu Haiying, Director of the Shanghai Aerospace Industry Promotion Center, noted that Shanghai is home to one-third of China's AI professionals and has a significant industrial base, with over 80,000 industrial manufacturing enterprises as of July 2024, instilling confidence in achieving its goals.
However, challenges remain, including the development of practical, scalable AI products and solutions, and the establishment of a sustainable smart manufacturing ecosystem, which requires deep talent expertise in both AI and manufacturing. Addressing industrial equipment connectivity, data standardization, and managing unstructured information are critical hurdles. A key challenge is also the development of cost-effective "AI+" solutions for small and medium-sized manufacturing enterprises.
This strategic push is viewed as a pivotal step in transforming China from a major manufacturing nation into a global powerhouse in smart manufacturing. By focusing on data, advanced models, and closed-loop application scenarios, Shanghai aims to advance the industry from isolated intelligent functions to comprehensive, full-chain smart manufacturing, setting a new global benchmark. The city's commitment is further underscored by its leading role in industrial internet platforms, connecting millions of devices, and its dense 5G network coverage, providing essential infrastructure for this digital transformation. Research indicates that China's industrial AI spending is projected to reach $12.53 billion by 2028, reflecting significant national investment in this sector.