Tesla is killing off its Model S and X cars to make robots

Tesla will “principally cease the manufacturing” of its Model S and X electrical autos subsequent quarter, CEO Elon Musk has announced on the automaker’s earnings name for the 2025 fiscal 12 months. “It’s time to convey the Mannequin S and X program to a finish with an honorable discharge, as a result of we’re actually transferring right into a future that’s based mostly on autonomy,” Musk stated. You may nonetheless purchase the autos so long as there are models to be offered, and Tesla guarantees to assist them for so long as folks have them. As soon as they’re gone, although, they’re gone for good, as a result of Tesla is changing their manufacturing area within the firm’s Fremont manufacturing facility into an area for the manufacturing of Optimus humanoid robots.

Mannequin S is Tesla’s second automobile and has been in manufacturing since 2012, whereas the Mannequin X SUV has been in manufacturing since 2015. Their shine has pale over time, nevertheless, and the newer Mannequin 3 and Y now make up the bulk of the corporate’s gross sales. For the entirety of 2025, as an illustration, Tesla delivered 1,585,279 Mannequin 3 and Y autos however solely offered 418,227 Mannequin S and X models. The corporate additionally needed to stop selling Mannequin S and X in China in mid-2025, as a result of they had been being imported from the US and had been topic to China’s tariffs that had been put in place in response to US President Donald Trump’s tariffs on imported items.

Within the name, Musk stated that Tesla’s long-term aim is to have the ability to manufacture 1 million Optimus robots within the present Mannequin S and X manufacturing area. On the World Financial Discussion board in Davos, Switzerland just a few days in the past, the CEO introduced that Tesla will start selling Optimus to the general public by the tip of subsequent 12 months. Musk has huge plans for Optimus and once said that it’s certain to grow to be the “greatest product of all time,” larger than cellphones, “larger than something.” However the humanoid robotic has been failing to dwell as much as the hype throughout demonstrations, and Musk is thought for his overly optimistic timelines.

The corporate’s earnings report has additionally revealed that Tesla invested $2 billion in Musk’s different firm, xAI. Tesla’s shareholders notably sued Musk in 2024 for beginning xAI, which they argued is a direct competitors to the automaker. The CEO has been claiming for years, in spite of everything, that Tesla is an AI firm and never simply an EV-maker. Nonetheless, Tesla’s shareholders approved Musk’s $1 trillion pay bundle in late 2025 on the situation that the corporate reaches a market worth of $8.5 trillion.