Tesla Discontinues Model S and Model X Production
Tesla has announced the discontinuation of its Model S and Model X electric vehicles, a decision that surprised many investors who fear the company is moving away from the electric vehicle market. CEO Elon Musk explained during a recent earnings call that the focus is shifting towards autonomy, aligning with Tesla’s long-term vision.
The sales numbers for these models support the decision; in the fourth quarter, they contributed only 12,881 unit deliveries, while the more popular Model 3 and Model Y saw 323,800 deliveries. The Model S and X represented just 1.2% of total EV deliveries, which emphasized their lower significance in Tesla’s product line. As part of a $20 billion capital expenditure by 2026, Tesla plans to convert production space at its Fremont factory to manufacture its Optimus robot instead.
The move away from high-cost luxury models is seen as a strategic adaptation to a market increasingly favoring more affordable vehicles. With automakers like Ford and Stellantis shifting focus towards lower-cost models, Tesla aims to remain competitive in the evolving electric vehicle landscape.
