Analysts at Barclays forecast that the physical AI sector, encompassing robots and robotaxis, could reach a $1 trillion market value by 2035. This projection highlights advances in AI-enabled robotics and may support Tesla CEO Elon Musk's ambitions for substantial wealth growth. The report attributes this potential to improvements in computational power, mechanical capabilities, and battery technology.
Barclays, an English multinational bank, has released a research note predicting significant growth in the physical AI sector. According to the note, accessed by Bloomberg on Tuesday, this market—defined to include robots and robotaxis—could expand to $1 trillion by 2035. Zornitsa Todorova, head of thematic fixed-income research at Barclays, attributes this outlook to large-scale advances in "brains, brawn and batteries," which are expected to drive AI-enabled robotics to an inflection point.
The projection comes amid Tesla's increasing emphasis on robotics. CEO Elon Musk has expressed ambitions tied to a trillion-dollar pay package, potentially bolstered by developments in physical AI. During an earlier Tesla earnings call, Musk noted potential competition, stating, "I do think that by far, the biggest competition for humanoid robots will be from China."
Industry observers point to technologies like Nvidia's Alpamayo as enablers for scaling autonomous driving in automakers and applying physical AI in production and manufacturing tasks. Meanwhile, competitors such as Boston Dynamics have developed the Atlas robot, capable of lifting objects up to 110 pounds and operating in temperatures from -4°F to 104°F. The company also indicates that skills learned by one Atlas unit can be shared across its fleet.
This Barclays report underscores the transformative potential of physical AI, positioning it as a key area for innovation in robotics and autonomous systems.