Tesla is set to wind down production of its Model S and Model X electric vehicles next quarter. CEO Elon Musk shared this news during the company’s earnings call. He suggested it’s time for these models to retire gracefully, as Tesla’s focus shifts towards autonomous vehicles. Once the current stock runs out, those models will be gone for good. The production space in Tesla’s Fremont factory will soon be repurposed for making Optimus humanoid robots.
The Model S has been around since 2012, and the Model X debuted in 2015. But lately, their popularity has waned. The newer Model 3 and Y have taken the lead, with 1,585,279 units delivered in 2025 compared to just 418,227 Model S and X vehicles. Tesla had to stop selling the S and X in China due to tariffs, which limited their sales further.
Musk has big ambitions for the future, aiming to produce 1 million Optimus robots in the space where the S and X are made. At the recent World Economic Forum, he mentioned plans to sell Optimus to the public by the end of next year. However, expectations may be running high. Early demonstrations of the robot haven’t always gone smoothly, and Musk’s timelines are often optimistic.
In addition to these changes, Tesla recently invested $2 billion into Musk’s other venture, xAI. This decision has raised questions among shareholders, some of whom sued Musk in 2024 over claims that xAI competes directly with Tesla. Despite this, shareholders did approve a massive pay package for Musk, contingent on the company achieving a market value of $8.5 trillion.
Tesla’s shift away from the Model S and X highlights a larger trend in the automotive industry. According to recent data from the International Energy Agency, global EV sales surged by 50% in 2022, reflecting a growing shift towards more affordable and efficient models. As the market evolves, companies like Tesla need to adapt to stay competitive and relevant.
For more information on Tesla and its financial performance, check out the official earnings report.
This transition may mark a pivotal moment for Tesla, moving more into robotics and AI, reflecting broader technological trends as companies seek to innovate and redefine their core businesses.
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