American electric vehicle manufacturer Tesla plans to cease production of the Model S sedan and Model X crossover and retool its factory in Fremont, California, to produce humanoid robots Optimus, company head Elon Musk said in a conversation with investors.
According to Musk, the production of both models is planned to be phased out in the next quarter. The company links this decision to the transition from the automotive business to the development of projects in the field of artificial intelligence and robotics.
Against the backdrop of these statements, Tesla reported an 11% decrease in revenue in 2025 and a 16% decline in vehicle deliveries in the fourth quarter year-on-year, partly due to weakened demand in Europe. The company's total revenue decreased by 3%, marking the first such occurrence in its history.
Tesla also confirmed plans to start production of Optimus robots by the end of 2026 and to invest $2 billion in the technology company developing artificial intelligence, xAI.
During a speech at a forum in Davos, Musk stated that in the future, there will be billions of humanoid robots in the world that will provide an abundance of goods and services.
He estimated that the number of humanoid robots will exceed the Earth's population, and in the future, such a robot will be available to every person. Additionally, the entrepreneur predicts that by the end of this year, artificial intelligence will surpass the intelligence of any individual person, and within five years, the collective intelligence of humanity.
Tesla is already engaged in the production of humanoid robots, Optimus, which, according to the entrepreneur, can be used in industry, social services, and everyday life.
