Tesla announced a major shift in its manufacturing strategy that will see the company discontinue production of its Model S sedan and Model X SUV and convert the assembly lines at its Fremont, California factory to build Optimus humanoid robots. The decision was disclosed during Tesla’s Q4 2025 earnings call, where CEO Elon Musk outlined plans to phase out the company’s long-running premium electric vehicles in favour of robotics and advanced automation manufacturing.
Tesla plans to retool parts of its Fremont manufacturing complex, where the S and X are currently assembled, to support production of Optimus humanoid robots. Musk considers Optimus as a long-term strategic product for Tesla, with aspirations to scale production and commercial deployment. The Fremont factory conversion is intended to support that vision by establishing a dedicated robotics production line. Exact timelines for the conversion and production ramp-up were not specified during the earnings call.
The Model S and Model X, introduced in 2012 and 2015 respectively, have represented a relatively small share of Tesla’s overall deliveries in recent years, with the more affordable Model 3 and Model Y accounting for the majority of sales volumes. Tesla said it will wind down production of the S and X over the coming quarters. Remaining cars already in production will be completed, and the company affirmed that service, parts, and support for existing vehicles will continue after production ends.
Optimus remains in an advanced prototype stage, with Tesla demonstrating iterations of the robot at company events and public showcases. Commercial production and sales have been discussed for the future, though firm launch dates and volume targets remain subject to development progress and engineering validation.
