Tesla To Discontinue Model S, Model X in Favour of Robotics

Tesla has dropped a huge bomb, announcing the discontinuation of Model S sedan and Model X crossover from its lineup. The American EV maker took to its X (formerly Twitter) handle to reveal that it will pull the plug on the production of these models in the coming quarter. This comes at a time when the Elon Musk-led company is shifting its focus to artificial intelligence and robotics.

During a recent earnings call, Musk assured that Tesla would continue to provide support to existing owners of these models for as long as they remain in use. In the same earnings call, Musk revealed that Tesla’s profits dropped by 45 percent in 2025. The company reported a 3% decline in total revenue in 2025.

Tesla shifts focus on Optimus humanoid robots

The Model S and Model X were produced at Tesla’s factory in Fremont, California. This facility will now be repurposed to manufacture Optimus humanoid robots and for future xAI infrastructure. Musk said the long-term goal is to scale it into an autonomous factory capable of producing up to 1 million units of the Optimus robot annually.

This development comes as Musk seeks to reposition Tesla from a pure electric vehicle manufacturer into an AI-focused company, a shift that underpins its roughly $1.5 trillion (approx ₹138 lakh crore) valuation. At the same time, clear reassurances on production plans are seen as crucial for maintaining investor confidence, especially as Tesla has repeatedly missed timelines and targets previously outlined by Musk.

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However, Musk’s ambitious roadmap which includes the development of Cybercabs, humanoid robots, as well as the Semi truck and Roadster sports car. This will require substantial investments in manufacturing capacity. These initiatives would push capital expenditure beyond $20 billion (approx ₹1.84 lakh crore) this year, more than double what Tesla spent in 2025. 

The Tesla Model S was known for its blistering performance, achieving a 0-60 mph (98 kmph) sprint under 3 seconds. On the other hand, the Tesla Model X was known for its practicality. It’s currently the only Tesla to offer a three-row seating option. However, its biggest highlight are the powered falcon-wing doors.