Tesla will start producing robots instead of the Model S and X electric cars - ForkLog: cryptocurrencies, AI, singularity, future

# Tesla to Start Producing Robots Instead of Model S and X Electric Cars

Tesla is ceasing production of the Model S and X vehicles and reconfiguring its Fremont, California factory to produce humanoid robots called Optimus. Elon Musk announced this during the fourth-quarter earnings conference call, reports CNBC.

“It’s time to bid farewell to Model S and X with honor. If you’re interested in purchasing them, now is the perfect time to place an order,” he said.

After the original Roadster, these two models are the oldest in Tesla’s fleet. Sales of the Model S began in 2012, and the Model X three years later.

Recently, the company significantly reduced prices on new models amid growing global competition in the electric vehicle sector.

The Model S starts at $95,000, and the Model X from $100,000. The more affordable versions of the 3 and Y, expected in late 2025, will cost approximately $37,000 and $40,000 respectively. The latter accounted for 97% of the 1.59 million vehicles sold by the company.

In its earnings report, the company reported a historic annual revenue decline, with sales falling in three of the last four quarters. In response, Musk is aiming to shift investor focus to autonomous vehicles and robots — areas where the company currently has no operations.

Optimus is a bipedal robot that allegedly can perform any task — from factory work to childcare. In the first quarter of 2026, the company plans to introduce the third generation of the robot, designed for mass production.

Musk stated that the Fremont assembly line will be capable of producing 1 million Optimus robots per year.

“This is a completely new supply chain. There are really no [car components] in Optimus,” the entrepreneur said.

The initiative also plans to increase staffing and achieve a “significant growth in production volume.”

Investments in xAI

Along with the earnings report, Tesla announced an investment of $2 billion in Musk’s other company — xAI.

The deal was part of a $20 billion funding round announced earlier in January.

“The investments were made on market terms, agreed upon with other investors,” the company said in its fourth-quarter earnings report.

xAI is one of the leading AI startups behind the chat-bot Grok. Recently, it has been under scrutiny by regulators worldwide due to a scandal involving the ability to generate and publish explicit deepfake images of real people on X.

Tesla includes Grok as a feature in some infotainment systems of its electric vehicles. In a new presentation for shareholders, company representatives stated that they have signed a framework agreement to evaluate potential collaboration in AI.

Recall that in January, Musk claimed that artificial intelligence could surpass humans as early as 2026.