--- title: "Learning from the Auto Industry, \"Repairing Robots\" May Be More Profitable Than \"Building Robots\" in the Future" type: "News" locale: "en" url: "https://longbridge.com/en/news/284491816.md" description: "Morgan Stanley predicts that global new robot sales will reach $25 trillion by 2050, but the true value lies in the downstream ecosystem. Drawing on the US auto dealer model, while new car sales account for 50% of revenue, they contribute only 20% of gross profit. In contrast, downstream profits from parts, services, financing, and insurance are four times those of new car sales. Based on this, the total revenue scale of the robot economy, including after-sales services, could expand by two to three times" datetime: "2026-04-29T04:25:03.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/284491816.md) - [en](https://longbridge.com/en/news/284491816.md) - [zh-HK](https://longbridge.com/zh-HK/news/284491816.md) --- # Learning from the Auto Industry, "Repairing Robots" May Be More Profitable Than "Building Robots" in the Future The real gold mine of the robot economy may not lie in manufacturing itself, but in the maintenance, service, and financial ecosystem behind the vast installed base of robots. According to Trend Trading Desk, on April 28, Morgan Stanley's Adam Jonas team published a research report **predicting that the global market for new robot sales will reach $25 trillion by 2050**, but this figure reflects only new robot sales. Drawing on the business model of US auto dealers, **Morgan Stanley believes that when downstream markets such as used robots, parts, repair services, financing, and insurance are included, the total revenue scale of the robot economy could expand by two to three times over the original basis.** For investors, this insight implies that focusing solely on robot OEMs may mean missing out on greater value potential. After-sales services, parts replacement, predictive maintenance, and even robot insurance are all poised to become more profitable sectors. ## $25 Trillion Is Just the Starting Point According to Morgan Stanley's Global Robotics Model (GROM), global new robot sales revenue will gradually climb from the billions of dollars in 2024 to approximately $25 trillion by 2050. Categories covered include household robots, small drones, humanoid robots, autonomous vehicles, industrial robots, professional service robots, and large vertical take-off and landing (VTOL) aircraft. However, Morgan Stanley analyst Adam Jonas points out that as the global installed base of robots continues to accumulate, billions of autonomous machines in various states of operation will be distributed everywhere, including a large number of faulty, damaged, or performance-degraded units. The report argues that keeping these machines operational will spawn massive commercial opportunities. The research note lists dozens of potential service categories running parallel to new machine sales, covering: > - **Hardware Level**: Sensor telemetry and calibration, sensor replacement, chip replacement, actuator replacement, full joint degree-of-freedom (DOF) replacement, battery replacement, hardware upgrades and customization > - **Software and Security Level**: Software updates, cybersecurity, cloud network coordination, autonomous policy verification > - **Energy and Infrastructure Level**: Wireless energy transmission, charging infrastructure, logistics and infrastructure construction > - **Operations and Management Level**: Predictive maintenance, training services and continuing education, cleaning and hygiene services > - **Financial and Legal Level**: Financing and insurance, trade-ins, Certified Pre-Owned (CPO) robots, robot liability/legal services, regulatory compliance and safety certification > - **Emerging Services Level**: Humanoid robot clothing/fashion, human-robot relationship and resource management, security and emergency services, decommissioning recycling and environmental protection services This list itself constitutes a complete investment map for the robot after-sales service market. ## Auto Dealer Model Reveals Profit Logic To quantify the potential value of the downstream market, Morgan Stanley broke down the revenue structure of six listed franchised auto dealers in the United States. These six companies are AutoNation, Asbury Automotive, Group 1 Automotive, Lithia Motors, Penske Automotive, and Sonic Automotive. Data shows that new car sales revenue accounts for about 50% of the total revenue of the aforementioned dealers, appearing to be the primary business segment. However, in terms of gross profit, **new car sales contribute only about 20% of the total combined gross profit.** **This means that profits generated from downstream segments such as used cars, parts and services, and financing and insurance are approximately four times those of new car sales.** Measured by gross profit, **parts and services** account for about 32%, **financing and insurance** account for about 13%, **used cars** account for about 4%, and **other businesses** collectively account for about 4%. Although new car sales contribute nearly half of the revenue, they contribute only about one-fifth of the profit. The huge gap between revenue and profit clearly reveals the high value-added nature of downstream services. Applying the profitability logic of the aforementioned auto dealers to the robot industry, Morgan Stanley believes that **after comprehensively considering downstream and adjacent businesses, the total revenue scale of the robot economy can reasonably be projected to expand by two to three times based on the GROM forecast.** ### Related Stocks - [MS.US](https://longbridge.com/en/quote/MS.US.md) - [AN.US](https://longbridge.com/en/quote/AN.US.md) - [ABG.US](https://longbridge.com/en/quote/ABG.US.md) - [GPI.US](https://longbridge.com/en/quote/GPI.US.md) - [LAD.US](https://longbridge.com/en/quote/LAD.US.md) - [PAG.US](https://longbridge.com/en/quote/PAG.US.md) - [SAH.US](https://longbridge.com/en/quote/SAH.US.md) - [MS-O.US](https://longbridge.com/en/quote/MS-O.US.md) - [MS-Q.US](https://longbridge.com/en/quote/MS-Q.US.md) - [MS-E.US](https://longbridge.com/en/quote/MS-E.US.md) - [MS-I.US](https://longbridge.com/en/quote/MS-I.US.md) - [MS-L.US](https://longbridge.com/en/quote/MS-L.US.md) - [MS-P.US](https://longbridge.com/en/quote/MS-P.US.md) - [MS-A.US](https://longbridge.com/en/quote/MS-A.US.md) - [MS-F.US](https://longbridge.com/en/quote/MS-F.US.md) - [MS-K.US](https://longbridge.com/en/quote/MS-K.US.md) ## Related News & Research - [General Atlantic-backed Indian insurer Acko eyes up to $2.5 billion valuation in IPO, sources say](https://longbridge.com/en/news/284170296.md) - [Silver Rock's Kumar Gears Up For Market Dislocation With $4 Billion War Chest](https://longbridge.com/en/news/284427307.md) - [Want to hire for your robotics startup? 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