During a recent earnings call for the 2025 fiscal year, Tesla CEO Elon Musk made a significant announcement regarding the future of the company’s Model S and Model X electric vehicles. Musk stated that production of both models would “basically stop” in the upcoming quarter, marking a symbolic end to a program that has played a pivotal role in the company’s history. He emphasized the transition towards an autonomous future, declaring, “It’s time to bring the Model S and X program to an end with an honorable discharge.”
While production will cease, customers will still have the opportunity to purchase existing inventory for the time being, and Tesla has committed to providing support for these models as long as they remain in circulation. However, once the remaining units are sold out, they will no longer be available, as Tesla plans to repurpose the production capabilities at its Fremont factory for the manufacture of Optimus humanoid robots.
The Model S, which debuted in 2012, and the Model X, launched in 2015, have seen their popularity wane as the company’s newer models, the Model 3 and Model Y, have captured the majority of sales. In fact, Tesla delivered over 1.5 million units of Model 3 and Y throughout 2025, while sales of the Model S and X only reached approximately 418,227 units. The situation was exacerbated when Tesla halted sales of these models in China mid-year due to tariffs imposed on U.S. imports following the trade policies of former President Donald Trump.
Musk further elaborated on Tesla’s long-term ambitions, revealing plans to produce one million Optimus robots within the facilities that once housed the Model S and X production lines. He recently announced at the World Economic Forum in Davos that Tesla aims to make Optimus available to the public by the end of next year, touting it as a potential game changer, with ambitions to outpace the impact of smartphones.
Despite these lofty goals, the humanoid robot has faced criticisms for falling short of expectations during public demonstrations, and Musk’s timeline has been characterized as overly ambitious in the past.
In the financial report, it was disclosed that Tesla invested $2 billion into Musk’s artificial intelligence venture, xAI. This move followed a controversial period in 2024 when Tesla shareholders filed a lawsuit against Musk, claiming that xAI presents a direct competition to the automotive giant. Musk has long positioned Tesla as an AI-focused enterprise, rather than merely an electric vehicle manufacturer.
In a surprising turn, shareholders approved a staggering $1 trillion compensation package for Musk in late 2025, contingent on Tesla achieving a market value of $8.5 trillion, illustrating the confidence investors have in his leadership despite the controversies surrounding his ventures.
