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Stephen Chen

In the Loess Plateau in China’s Shaanxi province, where coal mining has long been synonymous with back-breaking labour and perilous conditions, the Dahaize Mine is rewriting the rules of the industry.
The state-owned giant, operated by China National Coal Group, is thriving even in an era of falling coal prices – and posted a 40 per cent net profit margin in 2024.
For comparison, Wall Street titan Morgan Stanley achieved just over 20 per cent last year.
Dahaize’s success is the result of an “all out” bet on an automation revolution so aggressive and technically challenging that sceptics once dismissed it as unfeasible, said Liang Yunfeng, the mine’s CEO and architect of its transformation, in an interview with the Chinese-language Journal of Intelligent Mine in February.
With artificial intelligence (AI) and 5G oversight almost everywhere, Dahaize is the smartest coal mine ever built, according to industry body China National Coal Association.
Spanning 266 sq km (103 square miles) and with a 3.2 billion tonne coal reserve, Dahaize dwarfs other underground coal mines with 20 million tonnes of annual output.
Since production began in 2023, its 980 employees – a skeleton crew compared to traditional mines – have overseen fleets of 5G-connected robots, autonomous tunnelling systems and AI algorithms that coordinate almost everything, from coal extraction to railcar loading.

Each worker now produces nearly US$1 million worth of annual output, according to Liang.
At 640 metres (2,100 feet) below ground, AI-guided shearers use inertial navigation and lidar – or “light detection and ranging” technology – to carve coal seams with millimetre precision, adjusting cutting paths in real time to avoid water surges in the soggy depths.
“A crew of four is all we need,” Liang said.
Tunnel-inspecting drones scan shafts in eight minutes – a task that would take humans many hours – while robotic arms handle pipe repairs and many other functions.
Autonomous trucks, guided by an underground positioning system, navigate foggy, dust-choked tunnels to ferry coal to AI-powered washing plants, where one worker can process 1,100 tonnes of coal per day.
Even as China’s coal prices slid 18 per cent in 2024, Dahaize’s revenue hit 9.1 billion yuan (US$1.25 billion), with 3.8 billion yuan in net profit – a margin comparable to luxury brands.
The mine’s lean staffing model, paired with the government’s heavy research and development subsidies, have turned it into a profit engine, according to Liang.
Dahaize’s success underscores a looming clash between China’s automation-driven growth and Western labour models.
While in the United States the Trump administration resists automation to protect high-wage jobs, Dahaize proves that smart tech can sustain both productivity and profitability – even as Western economies struggle with wage inflation.


China’s AI revolution is not just about coal. Beijing’s fusion of government funding, 5G infrastructure and AI is creating blueprints for steel, chemicals and nearly all other major industries.
There is a growing consensus among China’s industrial experts that if the West clings to existing labour practices, the productivity gap will hollow out its middle class.
But making transitions would not be easy, according to Liang.
Even in Dahaize, which has been built from scratch for automation, the management has encountered resistance from workers, with many unprepared for AI oversight.
“Some folk think ‘going smart’ means robots take over everything – no humans needed,” Liang said. “People get frustrated and dig their heels in against the tech.”
But many are now changing their minds.
“Going smart isn’t just about making jobs safer, cutting down on back-breaking work, and getting more done – it’s like rewiring the whole system,” Liang said.
“It changes how we collaborate, flips the playbook for running things and gives every link in the value chain a serious upgrade.”


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China’s Dahaize Mine is rewriting the playbook on how a coalfield operates as automation takes centre stage


China’s Dahaize Mine is rewriting the playbook on how a coalfield operates as automation takes centre stage.
