Tesla to End Model S and Model X Production at Fremont Factory, Repurpose for Optimus Humanoid Robots
Tesla is making a dramatic strategic shift that could redefine the company's future. During the Q4 2025 earnings call, CEO Elon Musk announced that the company will be winding down production of the Model S and Model X vehicles at its Fremont, California facility, subsequently repurposing the entire factory for Optimus humanoid robot production.
This announcement sent shockwaves through the automotive industry. The Model S and Model X represent Tesla's premium vehicle lineup, with starting prices of $74,990 and $79,990 respectively. These vehicles have been the company's flagship products since 2012 and 2015, showcasing Tesla's most advanced technology.
Musk described this as Tesla's 'iPhone moment' - a reference to how Apple's original iPhone disrupted the mobile phone industry. The comparison suggests that Musk believes humanoid robots will eventually become as ubiquitous as smartphones, transforming everything from manufacturing to household chores.
The decision to stop producing these vehicles wasn't made lightly. The Fremont factory, which has been operational since 2010, has produced millions of vehicles. By converting it entirely to robot production, Tesla is signaling that it sees robotics as the future of the company, not just electric vehicles.
The Optimus robot, also known as Tesla Bot, has been in development since 2021. Previous demonstrations showed a humanoid robot performing basic tasks like walking and carrying objects. However, this is the first time Tesla has committed to full-scale manufacturing of the robots.
Industry analysts are divided on the move. Some praise Tesla's willingness to pivot toward what they see as the next big technology frontier, while others question whether abandoning proven vehicle revenue for unproven robotics technology is prudent.
The transition will take place over the next 12-18 months. During this period, existing Model S and X inventory will be sold off, and production will gradually wind down. The factory will then be retrofitted for robotic manufacturing.