From supporting role to strategic pivot, Hubei bets on the sensor track

The picture shows the production workshop of Huagong High Logic, a subsidiary of Huagong Technology’s intelligent sensing business. Liu Qian / Photo

Reporter Liu Qian from Securities Times

In the current wave of artificial intelligence sweeping the globe, sensors—serving as “translators” between the physical and digital worlds—are moving from behind-the-scenes industry to the forefront. Since the beginning of this year, Hubei has launched a tightly coordinated policy package targeting the sensor industry, viewing it as a “key variable” to drive the digital and intelligent transformation of future industrial systems.

China’s sensor industry has long faced a situation of being large but not strong. Relying on a group of “hidden champions” such as Huagong Technology, Sifang Optoelectronics, and Gd Infrared, which possess core materials and processes, Hubei is building a globally influential industrial cluster through ecological collaboration.

From Industry Supporting Role to Strategic Pivot

Recently, the Optical Valley Intelligent Sensing Technology Innovation Institute was officially inaugurated in Wuhan, with an initial 200 million yuan set up for the Optical Valley Intelligent Sensor Innovation Fund. These moves came less than two months after Hubei officially released the “Action Plan for Accelerating the Integrated Development of the ‘World Optical Valley’ Sensor Industry Cluster (2026–2030)” on March 2 (hereinafter referred to as the “Action Plan”).

“Don’t underestimate sensors—they may seem small, but every 1 cent invested can generate 10 to 100 yuan in output value, playing a ‘leveraging’ role,” said Yu Zheng, academician of the Chinese Academy of Engineering and president of Huazhong University of Science and Technology. From a global perspective, developed countries’ sensor industries account for about 1% of GDP, and “sensors + instruments” about 5%, yet they can leverage 50%–60% of national economic growth.

This is also the logic behind Hubei’s heavy investment in the sensor industry. Zhang Li, deputy secretary-general of the China Instrument and Meter Industry Association, pointed out that China’s sensor market is growing much faster than the global average and is in a stage of explosive growth. Currently, four major industrial clusters have formed: the Yangtze River Delta, Central and Western China, Beijing-Tianjin-Hebei, and the Pearl River Delta, with cities like Wuhan, Zhengzhou, and Xi’an leading in some niche sectors.

Data shows that Hubei has initially established a complete industrial chain covering design, manufacturing, packaging, testing, and system integration, with over 100 upstream and downstream sensor companies clustered there, including several “hidden champions.”

For example, Sifang Optoelectronics holds the world’s largest market share in laser PM sensors; Huagong Technology commands 70% of the global temperature sensor market; Gd Infrared is the only domestic company capable of producing both cooled and uncooled infrared detectors; and Juxin Microelectronics ranks third globally and first domestically in time-of-flight sensors.

The more urgent motivation stems from industry chain security.熊友辉, chairman of Sifang Optoelectronics, told reporters, “Especially in some high-end sensors, the localization rate is still quite low. For example, sensors used in ventilators are only 5% domestically produced.” Zhang Li also revealed that analysis of over 24,000 sensor companies nationwide shows that 90% are trade-oriented or application-focused, with only 7.8% engaged in manufacturing.

Many industry insiders believe that Hubei’s accelerated deployment of the sensor industry is not just targeting a billion-yuan niche but is viewed as a “key variable” to drive the digital and intelligent transformation of the entire industrial system.

Currently, Hubei is rapidly building an “51020” advanced manufacturing cluster system, consisting of five trillion-yuan pillar industries, six five-thousand-billion-yuan advantageous industries, and twenty hundred-billion-yuan characteristic industries. A relevant official from the Hubei Provincial Economic and Information Technology Department said, “We aim to seize the opportunity of ‘sensor + AI’ integration, making sensors a key variable to empower the ‘51020’ modern industrial clusters, through strengthening, supplementing, and extending the supply chain to create new growth points.” Additionally, Hubei has gathered academicians like Yu Zheng, capable of pioneering breakthroughs in sensors, to strengthen the national industrial chain security with a “Hubei defense line.”

Collaborative Support for Industry Development

Based on this, the “Action Plan” sets a goal for Hubei’s sensor industry to reach a scale of 30 billion yuan by 2030, with application industries exceeding 500 billion yuan.

How will this leverage effect be achieved? Zhang Li pointed out that by 2026, the focus is on whether the industry exists (“whether it is there”), from 2026 to 2030 on whether it is good (“whether it is good”), and from 2030 to 2035 on whether it is strong (“whether it is strong”). Achieving these leaps requires top-level government design, social industry funds, and market application scenarios working together.

Hubei’s approach has shifted from past single-point technological breakthroughs to full-chain ecological collaboration. The Optical Valley Intelligent Sensing Technology Innovation Institute is seen as the “brain” of this combined effort. Initiated by Wuhan East Lake High-tech Zone in partnership with Huazhong University of Science and Technology, Jiufeng Mountain Laboratory, Optical Valley Laboratory, and leading enterprises, it focuses on three core tasks: overcoming bottlenecks in core materials, core processes, and basic devices; establishing three professional platforms for design, verification, and testing; and connecting the entire “government-industry-university-research-finance-service” chain.

Yu Zheng believes that the biggest pain point in sensor industrialization is the engineering leap from 1 to 100. The institute will act as a “technology catalyst,” enabling laboratory samples to quickly transform into market-ready products.

Meanwhile, a sensor industry investment fund jointly initiated by Wuhan High-Tech Group, Chutian Fengming Fund, and Changfei Angel Fund aims to address industry pain points such as long R&D cycles and high trial-and-error costs, filling the funding gap between technological validation and large-scale production, injecting capital into ecological collaboration.

In physical space, Wuhan’s Optical Valley Intelligent Sensor Industrial Park has begun construction, focusing on cultivating and attracting companies in fields like embodied intelligence robots, low-altitude economy, intelligent connected vehicles, and future healthcare. It plans to develop products such as force sensors, flexible tactile sensors, and high-performance inertial sensors, promoting industry clustering from physical to ecological integration.

Activating Market Internal Drivers

From top-level design to infrastructure, the strategic layout of Hubei’s sensor industry is already clear. However, turning the plan into reality hinges on stimulating the endogenous motivation of market players, especially those already leading in niche sectors.

“Companies have broken through multiple core sensor technology bottlenecks, achieving full control from chips and devices to system integration,” Huagong Technology told reporters. The company has proactively laid out in low-altitude flying, embodied intelligence, and other fields, completed core technology and production line construction, and achieved targeted mass production, becoming one of the first to implement projects in the industry. In embodied intelligence, the company has completed flexible membrane technology and production line setup, applicable to dexterous robotic skin sensors, battery and motor thermal management, etc. In low-altitude aircraft, temperature sensors have been mass-produced for clients.

Additionally, the company will open up core technology platforms, chip packaging and testing resources, and application scenarios for design, R&D, and other key links, attracting upstream and downstream high-quality supporting enterprises and tech-driven innovative companies to gather in East Lake High-tech Zone. It also leads the formation of industry technology innovation alliances to promote integrated R&D, capacity deployment, and market expansion, focusing on tackling “bottleneck” areas like key components.

Last October, Sifang Optoelectronics announced plans to invest 600 million yuan to build an industrial base, focusing on automotive electronics, high-end scientific instruments, and low-carbon thermal engineering, further expanding into high-end sensor markets.

熊友辉 stated that for sensors to grow big, they cannot just be component suppliers; they must move toward integrated sensor and actuator solutions embedded within industry ecosystems. “If we only produce small parts, others will easily replace us; but if we offer complete solutions, it has strategic value.” He also suggested exploring cross-regional industry integration, such as acquiring traditional manufacturing companies in the Yangtze River Delta and Pearl River Delta, introducing Wuhan’s sensor technology to re-engineer the industry.

The proactive breakthroughs of leading enterprises resonate with government strategic guidance.

Xu Shengmin, deputy secretary-general of Wuhan Municipal Government, revealed that the next step will leverage the advantages of the Optical Valley in optoelectronic information and life health industries to promote industry integration through sensors; support companies like Rike Laser and United Imaging Healthcare in jointly developing real-time temperature sensing systems for laser ablation procedures; and encourage research cooperation between instrument companies like Saiwei and Jingchuan Diagnostics and sensor firms to accelerate product iteration and upgrading.