Tesla is preparing to close a major chapter in its history. During the company’s latest earnings call, CEO Elon Musk revealed that Tesla plans to wind down production of its longest-running vehicles — the Model S and Model X — and repurpose a key California factory to build humanoid robots instead.
According to Musk, the decision marks an intentional shift away from Tesla’s early luxury models and toward what he sees as the company’s future: autonomy and robotics. Production of both vehicles is expected to begin tapering off later this year, with a full stop planned shortly after.
“If you’ve been thinking about buying a Model S or Model X, now’s the moment,” Musk told investors, calling the phase-out an “honorable discharge” for the aging lineup.
The End of Tesla’s Oldest Icons
The Model S and Model X hold a special place in Tesla’s story. After the original Roadster, they were the vehicles that helped prove electric cars could be fast, desirable, and practical. The Model S launched in 2012 and quickly became a favorite among early EV adopters, while the Model X followed in 2015 with its distinctive falcon-wing doors.
But times have changed. As competition in the global EV market has intensified, demand for Tesla’s premium models has softened. Even after multiple price cuts in recent years, the Model S still starts around $95,000, and the Model X hovers near $100,000 — far above the company’s mass-market offerings.
Today, Tesla’s business is overwhelmingly driven by the Model 3 and Model Y. Those two vehicles accounted for roughly 97% of Tesla’s deliveries last year, with starting prices closer to $37,000 and $40,000 respectively. More affordable versions introduced recently have only strengthened their dominance.
Financial Pressure and a Strategic Pivot
The announcement came alongside Tesla’s fourth-quarter earnings report, which showed mixed results. While the company exceeded profit expectations, it also posted its first-ever annual revenue decline, with total sales down 3% compared to the previous year. Revenue fell in three of the past four quarters — a clear sign of mounting pressure.
Tesla’s vehicle sales have struggled amid growing competition from Chinese automakers and other global brands, as well as consumer backlash tied to Musk’s increasingly polarizing political activity.
Rather than doubling down on traditional EVs, Musk appears determined to redirect attention — and resources — toward long-term bets like robotaxis and humanoid robots, even though those areas currently generate little to no revenue.
Fremont’s Future: From Cars to Robots
As part of this transition, Tesla plans to convert its Fremont, California facility from an automotive factory into a production hub for its Optimus humanoid robots. While the robots have been demonstrated publicly, they are not yet commercially available, and timelines remain uncertain.
Still, Musk framed the move as essential to Tesla’s evolution, emphasizing that the company will continue supporting existing Model S and Model X vehicles for as long as owners keep them on the road.
“It’s a little sad,” Musk admitted, “but this is part of our shift toward an autonomous future.”
A Legacy That Changed the Industry
When the Model S first arrived, electric cars were widely viewed as impractical and niche. Many doubted whether a company focused solely on EVs could survive, let alone thrive. The Model S helped shatter those assumptions, earning high satisfaction ratings and building a devoted fan base. The Model X had a rockier start, particularly with reliability issues, but still expanded Tesla’s reach into the SUV market.
Now, more than a decade later, Tesla is preparing to move on — not because those cars failed, but because the company believes its next act lies beyond vehicles altogether.
Whether robots and autonomy can live up to that promise remains to be seen. But one thing is clear: the era of the Model S and Model X is coming to an end.
