Tesla is killing off its Model S and X cars to make robots

Tesla will “basically stop the production” of its Model S and X electric vehicles next quarter, CEO Elon Musk has announced at the automaker’s earnings call for the 2025 fiscal year. “It’s time to bring the Model S and X program to a end with an honorable discharge, because we’re really moving into a future that’s based on autonomy,” Musk said. You can still buy the vehicles as long as there are units to be sold, and Tesla promises to support them for as long as people have them. Once they’re gone, though, they’re gone for good, because Tesla is converting their production space in the company’s Fremont factory into a space for the manufacturing of Optimus humanoid robots.

Model S is Tesla’s second vehicle and has been in production since 2012, while the Model X SUV has been in production since 2015. Their shine has faded over the years, however, and the newer Model 3 and Y now make up the bulk of the company’s sales. For the entirety of 2025, for instance, Tesla delivered 1,585,279 Model 3 and Y vehicles but only sold 418,227 Model S and X units. The company also had to stop selling Model S and X in China in mid-2025, because they were being imported from the US and were subject to China’s tariffs that were put in place in response to US President Donald Trump’s tariffs on imported goods.

In the call, Musk said that Tesla’s long-term goal is to be able to manufacture 1 million Optimus robots in the current Model S and X production space. At the World Economic Forum in Davos, Switzerland a few days ago, the CEO announced that Tesla will start selling Optimus to the public by the end of next year. Musk has big plans for Optimus and once said that it’s bound to become the “biggest product of all time,” bigger than cellphones, “bigger than anything.” But the humanoid robot has been failing to live up to the hype during demonstrations, and Musk is known for his overly optimistic timelines.

The company’s earnings report has also revealed that Tesla invested $2 billion in Musk’s other company, xAI. Tesla’s shareholders notably sued Musk in 2024 for starting xAI, which they argued is a direct competition to the automaker. The CEO has been claiming for years, after all, that Tesla is an AI company and not just an EV-maker. Still, Tesla’s shareholders approved Musk’s $1 trillion pay package in late 2025 on the condition that the company reaches a market value of $8.5 trillion.