Tesla phases out Model S and X to focus on robotics

Tesla is preparing to end the era of its most recognizable premium electric vehicles. During the 2025 fiscal year earnings call, Elon Musk stated that the company will effectively halt production of the Model S and Model X in the next quarter. According to him, these models are being phased out as Tesla wants to focus on a future built on autonomous technology and robotics.

The Model S launched in 2012 as the brand's second model, with the Model X crossover following in 2015. However, their popularity has significantly declined. Today, Tesla's sales are dominated by the more mainstream Model 3 and Model Y. In 2025, the company delivered over 1.58 million vehicles from these series, while the Model S and X moved about 418,000 units. An additional blow came when both models stopped selling in China due to import tariffs from the US.

Tesla plans to use the freed-up production capacity at its Fremont factory to manufacture its humanoid Optimus robots. Musk announced the long-term goal is to produce up to one million such robots on the space previously occupied by the Model S and Model X. He also indicated Tesla aims to start selling Optimus to the general public by the end of next year, calling the project potentially the biggest product in history.

Nevertheless, Optimus has yet to live up to grand expectations. Robot demonstrations have repeatedly drawn skepticism from experts, and Musk is often criticized for overly optimistic timelines. Meanwhile, Tesla continues to actively position itself not just as an automaker, but as a company in artificial intelligence and autonomous systems.

The report also revealed Tesla invested $2 billion in Musk's startup xAI, despite criticism and legal claims from shareholders. Investors, however, supported his massive compensation package, anticipating company growth toward a market capitalization of $8.5 trillion.