Overcapacity is China’s biggest AI advantage

This model of state-driven overproduction makes advanced hardware like EVs, drones, and industrial robots incredibly cheap, which massively accelerates their adoption across the country. Each of these devices then acts as a real-world sensor, generating a constant stream of invaluable data that is used to train and improve AI systems for physical applications. Zhang contends that while the US remains focused on the race for more powerful models and advanced chips, it risks losing the more consequential contest: the race to embed AI into the machines and infrastructure that will define the future economy. 

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