Tesla said it will end production of its flagship Model S sedan and Model X SUV next quarter as it shifts its focus from traditional electric vehicles to robotics and autonomous tech. CEO Elon Musk announced the change on a recent earnings call, saying it’s time to move on from those models and repurpose the space for Optimus humanoid robots and future self-driving products.
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Musk told investors, “We expect to wind down S and X production next quarter and basically stop production,” adding that while the models are being retired, Tesla will continue to support owners who already have them. The move marks the end of a long run for both cars — the Model S helped make Tesla a household name in EVs when it launched in 2012, and the Model X followed a few years later with its SUV design.
The decision comes as Tesla reported weaker vehicle deliveries and a drop in annual revenue, even though the company still beat Wall Street expectations for earnings. Tesla plans to use the freed-up factory space at its Fremont, California, plant to build Optimus robots and support future autonomous efforts like its Cybercab robotaxi program, which is expected to begin production later this year.
Musk has long talked about Tesla as more than a car company, a pivot that’s now playing out in real production choices. With its lineup now centered on the more affordable Model 3, Model Y, and the upcoming Cybertruck, the shift reflects a bet that robotics and self-driving services could play a major role in Tesla’s future.
Tesla has made several other moves recently that point to where the company is headed. It partnered with Uber Freight on a program to make Tesla Semi trucks more affordable for carriers, an effort to accelerate the adoption of electric heavy-duty trucking. DHL Supply Chain has also begun running a Tesla Semi on daily routes in California following a successful pilot. Earlier this year, Tesla said it plans to test a fully self-driving vehicle delivery, with a Model Y expected to drive itself from a factory to a customer’s home in Austin.
