Tesla Discontinues Model S and Model X
Tesla has announced it will discontinue its Model S and Model X vehicles to shift focus toward autonomy and robotics. CEO Elon Musk cited a strategic move away from high-cost, low-volume cars, as Q4 deliveries of the S/X models were just 12,881 compared to 323,800 for the Model 3/Y. The company plans to repurpose production space for its Optimus robot, with a planned investment of $20 billion in the robotics division.
- The Model S, first delivered to customers in 2012, was a landmark vehicle that proved electric cars could be both desirable and high-performance. It was followed by the Model X SUV in 2015, which was developed on the same platform. - This strategic shift is part of a broader company mission change, from "accelerate the world's transition to sustainable energy" to "amazing abundance," reflecting a deeper focus on AI and robotics. - The production space at the Fremont, California factory, previously used for the Model S and X, will be converted into a manufacturing plant for the Optimus humanoid robot. - Tesla's stated goal is to eventually produce one million Optimus units annually at the repurposed Fremont facility. - While the company is pivoting, it is not abandoning the auto market entirely and will continue to produce the higher-volume Model 3 and Model Y. - Elon Musk has projected that the Optimus robot business could eventually make Tesla a $25 trillion company and that the robots could be priced between $20,000 and $30,000. - The Optimus robot utilizes the same advanced AI systems that were developed for Tesla's Full Self-Driving vehicle technology. - This move comes as Tesla's GAAP net income dropped by 46% in the 2025 fiscal year, from $7.1 billion in 2024 to $3.8 billion.
