publication
2026-01-29 09:40
Tesla will stop producing two popular car models, using the freed up factory space to build humanoid robots, Elon Musk announced during the company's earnings conference, suggesting that electric vehicles will soon be its secondary business.
In 2025, Tesla's revenue decreased by 3% to $94.8 billion. It was the first such case in the history of the company. Full-year net profit decreased by as much as 46% to USD 3.8 billion. Vehicle sales fell by 8.5% to 1.64 million units. The only positive aspect of the results presented on Wednesday was the gross margin, which increased from 16.3% to 20.1%.
Last year, Tesla was officially pushed out of the leadership position in the electric car segment by China's BYD, which sold 2.26 million battery-powered vehicles. The company's latest model, the Cybertruck, is much less popular than expected.
However, according to the declaration from Wednesday's conference, cars are no longer in the center of interest of Elon Musk and Tesla. The company announced the end of production of two vehicle models – the Model S sedan and the Model X crossover – by the end of the next quarter.
The decision should have a limited impact on revenues, as both vehicles currently account for approximately 3% of the company's global sales. The freed up factory space will be used for the production of Optimus humanoid robots. Their third generation is to be presented in the first quarter.
At the same time, Elon Musk admitted that the product is at the research and development stage and he does not expect significant production to begin this year.
Calibration of Musk's promises. Where are the 10,000 robots?
In June 2024, Tesla's official social media account reported that two humanoid robots performing autonomous tasks were working in the company's factory. In the same month, Elon Musk said during the earnings conference that he expects up to several thousand robots to work in his factories by 2025.
In 2025, the billionaire only increased expectations, saying that the company's internal plans envisage the construction of 5,000 to 10,000 Optimus robots by the end of the year. He also declared that he was sure that these robots would perform useful tasks.
During Wednesday's 2025 earnings conference, investors learned from Elon Musk that none of his Optimus robots perform useful tasks, and their role in the company's factories is limited to training them to become useful.
There is also no information about the number of robots produced. It's probably closer to hundreds than thousands.
Mass production of autonomous taxis and artificial intelligence
In addition to humanoid robots, Tesla also focuses on the development of the so-called robotaxi. Elon Musk declared during the earnings conference that the Cybercab, a two-seater autonomous vehicle without a steering wheel or pedals, would ultimately be sold in quantities “several times higher” than all of the company's other vehicles combined.
So far, however, these are distant plans. While competing companies are already offering autonomous driving in other American cities, Tesla is still at the testing stage. Its “robotaxis,” some 30 of them, operate only on the streets of Austin, Texas, most of them are off the road most of the time and still require employees to monitor their safety.
Elon Musk's other priority remains artificial intelligence. Tesla revealed in its latest report that it has entered into a $2 billion investment agreement with xAI. The artificial intelligence company founded by Musk in 2023 also owns his social media platform X.
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