Tesla shifts focus from cars to humanoid robots

Elon Musk’s Tesla is set to discontinue production of its Model S and Model X vehicles and pivot toward launching a humanoid robot assembly line.

Tesla CEO Elon Musk announced the move during Tesla’s 2025 financial results webcast, saying the automaker will phase out the S and X models in order to concentrate on developing its Optimus robots.

The premium Model S and Model X have seen relatively weak demand, with most buyers opting instead for the more affordable Model 3 and Model Y.

Production of the S and X is expected to end in the second quarter of 2026. Tesla’s Fremont factory in California will then be retooled to manufacture Optimus humanoid robots. In the longer term, the facility is expected to produce up to 1 million Optimus units annually.

“Musk has been urging investors to focus less on car sales and more on what he considers a bright new artificial intelligence future of robotaxis ferrying millions in cars without drivers, or even steering wheels, and robots watering plants and taking care of elderly parents,” the Associated Press noted.

According to the outlet, Tesla’s annual profit fell to its lowest level in five years, dropping 46% to $3.8 billion. The company has also lost its position as the world’s largest electric vehicle maker to Chinese rival BYD. Despite this, investor confidence in Musk remains intact: Tesla shares rose 9% over 2025.