Tesla to end Model S and X production, shift to Optimus robots
Tesla CEO Elon Musk said on Wednesday that the company will end production of its Model S and Model X vehicles and repurpose its Fremont, California, factory to manufacture Optimus humanoid robots.
Speaking during Tesla’s fourth-quarter earnings call, Musk said the decision marks the conclusion of the automaker’s longest-running vehicle programs, News.Az reports, citing foreign media.
“It’s time to basically bring the Model S and X programs to an end with an honorable discharge,” he said, adding that customers interested in purchasing either model should place orders soon.
After the original Roadster, the Model S and Model X are Tesla’s oldest vehicles. The Model S sedan was introduced in 2012, followed by the Model X SUV three years later. In recent years, Tesla has repeatedly cut prices for the two models as competition in the global electric vehicle market has intensified.
According to Tesla’s website, the Model S currently starts at about $95,000, while the Model X is priced from around $100,000.
Tesla’s sales are now overwhelmingly driven by its more affordable vehicles. The Model 3 and Model Y accounted for 97% of the company’s 1.59 million vehicle deliveries last year. The Model 3 currently starts at roughly $37,000, and the Model Y at around $40,000, with Tesla introducing lower-cost versions of both models late last year.
In its earnings report released Wednesday, Tesla disclosed its first annual revenue decline on record, with sales falling in three of the past four quarters. As growth in traditional EV sales slows, Musk has increasingly emphasized the company’s long-term focus on autonomous vehicles and humanoid robots, areas where Tesla has yet to establish a significant commercial presence.
Tesla is developing its Optimus robot with the goal of eventually selling it as a bipedal, intelligent machine capable of performing tasks ranging from factory labor to childcare. The company said it plans to unveil the third generation of Optimus later this quarter, describing it as its first design intended for mass production.
Musk said during the call that Tesla will replace the Model S and X production line at the Fremont facility with a manufacturing line capable of producing up to one million Optimus units per year. He noted that Optimus requires an entirely new supply chain, separate from Tesla’s existing vehicle operations.
Tesla expects to increase staffing at the Fremont factory as part of the transition, Musk added, and aims to significantly ramp up production output at the site.
By Nijat Babayev
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