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How AI and Sensor Tech are Taking Robots from Factories to City Streets

Not long ago, robots could only be found behind factory walls, performing repetitive tasks in predictable environments far removed from our daily lives. That has changed in the past few years. Robots are now stepping out into the world, rolling down sidewalks, navigating chaotic city streets, and learning to adapt to the unexpected, thanks to rapid advances in artificial intelligence (AI), sensor technology, and edge computing.

In the past, a robot might have followed a fixed routine on an assembly line. Today’s robots are equipped with vision systems that rival the human eye and neural networks capable of interpreting natural language and complex instructions. Powerful sensors, i.e., cameras, LiDAR, and microphones, give these machines an awareness of their environment that would have been considered science fiction a decade ago. And, with edge computing now providing instant processing at the source, robots can make split-second decisions without waiting for a remote server to tell them what to do. These technological advances have sparked a dramatic shift in both the scale and ambition of robotics. A Citi Group analysis projects there will be as many as 1.3 billion AI-powered robots by 2035, and as many as four billion by 2050. This isn’t just driven by what’s possible, it’s also about what’s needed. Around the world, populations are aging, labor shortages are increasing, and societies are looking for solutions that go beyond what human workers can deliver. As Jensen Huang, CEO of NVIDIA, said in 2024, “The next wave of AI is here. Robotics, powered by physical AI, will revolutionize industries.” Elon Musk, Tesla’s CEO, believes that the market for humanoid robots alone could someday top a billion units per year and envisions a future where robots may outnumber humans.

Already, in the cities, autonomous vehicles are undergoing live trials and beginning to transport passengers without a driver behind the wheel. Companies like Waymo already conduct over 100,000 self-driving rides a week in the United States. While these vehicles remain expensive and are closely scrutinized by regulators, the direction is clear: Robots are being trusted with higher-risk, higher-value tasks. The possibilities are enormous, from reducing the 1.4 million lives lost each year to car crashes, to increasing mobility for people who can’t drive, to freeing up countless hours for other pursuits. Robots are also becoming an ordinary presence in homes. Consider the rapid rise of the robot vacuum. These AI-enabled devices already sweep and mop floors in about a fifth of all American households, quietly adapting to cluttered rooms and learning how to navigate around pets and furniture. Citi Group predicts that by 2050 there will be 1.2 billion household cleaning robots

and 25 million commercial cleaning robots worldwide. These machines are not only practical but offer a glimpse of a future in which robots handle many everyday chores, granting us more time for creativity, relaxation, and connection.

Perhaps the most fascinating advance is the emergence of humanoid robots. Designed to operate in spaces built for people, these robots are starting to appear in factories and warehouses, helping move goods or perform delicate assembly. The vision is broader: As these machines improve, they could serve as caregivers for the elderly, assistants for people with disabilities, or domestic helpers able to clean, cook, and manage daily routines. Citi Group estimates that the market for humanoids could reach $7 trillion by 2050, with nearly 650 million such robots in service by then.

None of this would be happening without the marriage of AI and advanced sensors. Foundation models – massive AI systems pre-trained on enormous datasets – allow robots to understand not just numbers or rigid commands, but spoken language, visual cues, and even intent. The latest robots combine these models with real-time information from cameras and microphones, enabling them to carry out a voice command like “please fetch my glasses from the kitchen.” They learn new tasks through observation and can even handle zero-shot or few-shot learning, meaning they require little additional training to tackle something new. Simulation platforms allow robots to practice in virtual worlds before ever interacting with the real one, drastically speeding up their ability to adapt and improve. The next leap may be even more profound, as wireless networks evolve from 5G to 6G. With 6G, robots will be able to access vast amounts of AI processing power and data from the network itself, rather than relying solely on their own hardware. This will enable ultra-fast responses, real-time collaboration among fleets of robots, and an entirely new level of situation awareness. Robots will be able to identify problems, define tasks, and adapt to shifting circumstances, operating not just at the level of task execution, but at a “meta-level” of autonomous decision-making.

Economic factors are also driving this transformation. As robots become more capable and affordable, they represent an attractive solution for economies facing demographic challenges and labor shortages. Labor costs account for more than half of global GDP, and the payback period for robot investment is shrinking. Robots are already taking on jobs that are dirty, dull, or dangerous, freeing humans to focus on work that requires creativity or emotional intelligence. Of course, these changes come with real challenges. Not every job displaced by automation will be replaced by a better one. Concerns around privacy, safety, and ethics will need to be addressed as robots become a daily presence in our lives.

Innovation is happening on a global scale. The US leads in AI research, China is responsible for the majority of robotics patents, and Europe is promoting human-centric, trustworthy robotics. Venture capital in Asia is pouring into robotics, and even less developed regions are expected to see widespread adoption by 2050.

The robots of the near future will not be cold, distant machines hidden from view. Instead, they will clean our homes, deliver our packages, care for our elders, and collaborate with us in ways we’re only just beginning to imagine.