Tesla ending Models S and X production
cnbc.com155 points by keyboardJones 6 hours ago
155 points by keyboardJones 6 hours ago
The next shoe to drop will be shifting Model Y production from Fremont to Austin. Fremont will make Model 3s. Austin will make Model Ys and Robotaxis/2s. Cybertruck will be canceled. None of the Tesla plants will be making robots at any scale for many years.
I can't remember when was the last S/X refresh. It's nuts they just let it go stale and shut the factory down.
Tesla got the job done, which was empower Musk, not manufacture EVs at scale. The stock is the product.
Has it all really been just one giant grift to steal every Americans social security number.
And what would he do with them?
The same systems had labor board whistleblower info.
Why would musk love to identify (or at a minimum, but a huge chilling effect on) labor board whistleblowers? The world may never know.
Try to impair democracy through election denial groups? Absolute power and all that jazz.
https://news.ycombinator.com/item?id=46734078
https://www.npr.org/2026/01/23/nx-s1-5684185/doge-data-socia...
“Maybe you do not care much about the future of the Republican Party. You should. Conservatives will always be with us. If conservatives become convinced that they can not win democratically, they will not abandon conservatism. The will reject democracy.” —- David Frum
Yeah I don't buy this announcement. Converting their huge Fremont facility to just making humanoid robots? Do they have some large buyer or something? I'm skeptical.
IF they work (and that is a massive, massive if), every factory on earth will replace every human with them.
It’s inevitable, the only question is how many years until it happens: 2, 5, 10, 50?
Place we your bets!
Do think factories are still mostly humans on assembly lines?
Not mostly, no.
But I toured an auto assembly plant of a major US OEM recently and there were a ton of humans on the line.
Unions will be an issue, but all the OEMs are walking dead anyway.
they have a large buyer - all of the silly people investing money in the company
[flagged]
We can kill robots without remorse, and they're likely going to be worse than a human agent at most things for a few years. Not a bad timeline for them to waste their time on.
As insane as American politics is "I can blast robots on my property" has exactly the right amount of crank appeal to be possibly the final 90/10 issue
What if they're private property though? Historically, the state has always valued private property over human lives, so the response could be even more brutal.
Except we're the ones that pay for robots, and the cleanup and the settlements.
Tesla is a meme stock in a similar manner to GME. You cannot bet against them even if they have incredibly unsure future prospectives because there are too many believers who will buy any dips.
That might be a little extreme. Tesla is making electric cars and robots. These are very much things of the future.
GameStop is buying and selling used games, which is becoming impossible as consoles keep pushing for digital games.
GameStop requires a major shift in their business model to stay relevant, while Tesla just needs to hope the public doesn’t reject the idea of electrics cars out of stubbornness or politics.
While there is a lot of hype baked into both stocks, it seems like hype with Tesla is founded in more reality than the GameStop hype.
Electric cars, maybe. Tesla is valued much larger than the rest of the auto industry combined though.
Humanoid robots? Ain’t nobody made the business case for that. It is pure vibes.
Didn’t they just announce their profits dropped like 45% year over a year?
https://techcrunch.com/2026/01/28/tesla-earnings-profit-q4-2...
They’ve been overvalued for a very very long time. And then the head of the company decided to alienate as many people as possible. All while pouring a ton of resources into a product that very few people want instead of saner things.
Tesla's sales are standing still in a growing market. Are they GameStop? Maybe not, but they still require a major shift or their competitors will leave them behind in the dirt.
Tesla's valuation is not related to their production of cars or robots.
refrigirators then? some other household appliances? what exactly is “thing de jour” tesla is today?!
BYD made 35% more electric cars than Tesla and its market cap is about 1/10th.
Tesla's valuation has no grounding in any physical goods it manufactures.
The current administration is “rejecting the idea of electric cars out of stubbornness or politics.” See: Trump moving to withhold funding for EV chargers, terminating EV mandates and government support, etc. I don’t know what Musk is thinking by supporting this administration so steadfastly as they work hard to undermine his own efforts and initiatives.
I'm not making any specific assertions about what's in Musk's heart. I can draw some conclusions from his behaviors, actions, and words, but that's neither here nor there.
I will say, though, that there is a longstanding tradition, certainly in the United States, of an in group hurting their own material interests to deprive an out group of that same thing. https://www.marketplace.org/story/2021/02/15/public-pools-us...
Musk got what he needed at the expense of losing some tax incentives for his customer base. He was able to shut down government investigations into him/his companies. That alone should have been worth quite a salary bump.
The only thing keeping Tesla afloat currently is tariffs and restrictions on far cheaper and far better foreign alternatives. That's not a solid foundation. It's certainly not a trillion dollar company.
The dam is breaking. We have Canada lowering tariffs and agreeing to allow the import of Chinese EVs (limited, at least to start with) and the US administration goes off on Canada for doing it because they know what it means: crumbling American influence.
South America, Africa and Asia are likely forever lost to Tesla. And European sales are tumbling.
The supercharger network will maintain some inertia for some time but only for so long.
You can see this in Tesla announcements about attempts to diversify. AI robots? I'll believe it when I see it. Robotaxis? Well you're reliant on FSD for that and you have stiff competition in Waymo and who knows what China is cooking up there.
The GP was correct: it's a meme stock. It's no longer an investment in a business. It's an investment in Elon and, more generally, an investment in the administration. There's no fundamental way to predict how that goes and on what time scale. If you want to gamble, gamble. But gamgling is what it is. And, just like Twitter, I guarantee you the people at the top won't be left holding the bag.
BYD makes electric cars. Not sure if Trump will let you import them.
Nor will any American president. Detroit would collapse overnight (again).
The Elon hate is really creating a blind spot for many people here.
You can’t just compare Tesla to a meme stock when the founder’s side gig is launching and landing orbital rockets - a feat that even the most technologically advanced nation states have failed to accomplish.
Come on people, use a little critical thinking skills.
Critical thinking might ask how the valuation of company A has any relationship to the activity of a completely separate company B (planning for its own IPO)
But I will concede the founder's other side gigs would appear to have significantly affected its sales
I am confused about what Tesla is doing. They have effectively two automobile products now with one failed product (cybertruck). reading various articles about this doesn't make it more clear. Do they not want to be a car company?
The problem with being a car company is that they'd have to compete with China. It's possible, but they'd have to make additional capital investments to keep up. They've just wasted a ton of money on a failed Musk vanity project (Cybertruck) and squandered a ton of goodwill in their home market via the DOGE fiasco. Cash flow is not what it once was, and if they're going to make a big capital investment, they're probably right in looking at robots. But that strategy puts them back where they were 20 years ago, just getting started in EVs, and their cash flow will depend on cars for many years to come.
If the problem with being a car company is that they'd have to compete with China, then I have some bad news about being a robot company. China is already farther ahead in both technology and volume of humanoid robots.[0][1][2][3]
[0] https://www.cnbc.com/2026/01/28/cnbc-china-connection-newsle...
[2] https://interestingengineering.com/ai-robotics/limx-humanoid...
[3] https://www.bgr.com/2083491/china-agibot-humanoid-robot-us-c...
Fair point. It's hard to support Tesla's valuation as a car company, it may be even harder to support as a robot company. You have to wonder what might have been if they'd spent that Cybertruck money on battery research.
Is there anything China isn't far ahead in? Maybe capitalism was a failure.
Market cap and it's not even close. Turns out financialisation is the classic you-get-what-you-asked-for-not-what-you-wanted of capitalism. We told the optimiser to make number go up, and number has certainly gone up. China's number? Not as up.
I think it could have gone differently if we gave our economic system something to optimise other than itself, but then we wouldn't have centibillionaires, so... swings and roundabouts I guess?
Or in a more charitable light maybe capitalism just isn’t the only system that’s capable of reaching certain technological development.
>Maybe capitalism was a failure.
China is hyper-capitalist. They're living proof that capitalism has won.
It's not like US is not capitalist in anything: it's still state-of-the-art in software, which preoves that the problem is not with capital markets.
It just probably overregulated hardware manufacturing out of existence with unionizing and other too strong regulations.
China is a mixed economy with some capitalist parts and some socialist parts just like us. Their mix is just a bit more effective than our mix than our mix and they have higher scale.
It's more effective at depressing wages and at shovelling other people's money at whoever the politicians want to win. They are also much better at hiding debt -- in manufacturing companies, in banks, and in provincial governments. A lot of their successes lose money but they are awesome at hiding it and they might well outcompete Western companies and thereby cause a lot of harm.
China is capitalist on a state level, that's where they are winning. The US lets things get mired in red tape and special interests because nobody wants to take responsibility for growth.
In China, I imagine that if your company does something relevant to the five year initiative then you get a lot of red tape cut for you.
It doesn't help that Musk supported a guy who turned around and gutted the incentives that were helping Tesla turn a profit.
It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors. Now that the credit is gone, Tesla owners are closer to being in the black on their cars and it also caused Ford and GM to cut EV production by I believe 100%. Win win for Tesla.
> It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors.
This makes sense if your business strategy is to get existing Tesla owners to trade their current Teslas to buy new Teslas, rather than to convert non-Tesla owners to buy new Teslas. The latter market is WAY bigger and the tax credit was a huge carrot enticing them to look at a brand they'd never try otherwise in a market where ICE vehicle prices were skyrocketing.
As it stands, there are a ton of Tesla owners who bought their cars with the tax refund, are underwater on them, bitter about it and/or dislike Elon personally, and will never buy a Tesla again. This is churn and brand destruction without a corresponding top of funnel increase.
In contrast, the supercharger network was significant not just for the convenience factor for Tesla owners, but also for the fact that it was a social signal that Tesla was serious about growing the addressable market of EV owners generally by not just making a decent car but making the "EV lifestyle" seem possible to non-EV owners.
If Tesla actually is happy that the tax credit is going away, that seems like they're acknowledging that they're satisfied taking shrinking share of a shrinking market, which is their prerogative, but it's a bad business.
You lost me, how does making previous owners whole help tesla sell new ones?
This seems bizarre. Only reason my family bought a Tesla is thanks to the ev tax credit. Without it there are far better options.
Of course, it's 4D chess. This was such a genius move that Tesla profits fell 46% last year and they are ending production of their highest-margin vehicles.
GM wrote down $4B when they reduced their EV production. Despite that, last year GM sold half the number of EVs as Tesla did. If THAT was reduced production by 100%, then Tesla would have been truly fucked had Harris won the election.
Tesla is suffering because Elon Musk was a genius at some point in the past. Then, he got into ketamine and fried his brain.
The cars are expensive, have QC issues, and are facing steep competition from the rest of the world. Tesla's attempt to build an F150 competitor was a disaster, Optimus is years away from being useful for anything, and after 15 years of "We'll totally release FSD this year!" the market seems to finally be realizing that it's not going to happen for a little while.
It really sucks to see a perfectly good company get blown to smithereens, but shareholders did choose to bet on the man.
won’t killing the EV market hurt Tesla in the long run?
markets are healthiest when there are many healthy competitors
Right now they struggle to compete with European car manufacturers, there is no way they can compete with China.
Tesla "competed" by corruptly getting BYD banned from the US and hurting US consumers.
Looks like they took Peter Thiel’s animosity towards competition too literally by blocking BYD from the US market. Without competition, they had no incentive to innovate since they were selling into the wealthiest market in the world for their product, the US.
No innovation made them stagnate. Being blocked from the US made BYD innovate.
Automotive stocks are subject to the rules of gravity, aka "boring", while tech stocks are not. Automakers operate on low margins and high volume, and must compete on price, reliability or luxury brand status. Most automakers have multiple brands to sell to all market segments.
Tesla's value proposition was that it was going to be an iPod in a world of identikit MP3 players, and charge a premium for it. One brand to rule them all, no pesky dealerships, with futuristic EV tech and a touchscreen dash that made gas-powered, tactile button-laden cars obsolete.
That was twenty years ago. Tesla went from leading the pack to struggling to achieve scale, with its limelight-seeking leader increasingly holding it back. The leader wants headlines for pioneering "cool shit" and pushing hype to pump the stock price. Buyers on the other hand want affordable and timely repairs (impossible with their resistance to third party body shops and unit cost of replacement parts). As a mature company, it is completely un-equipped to compete with the incumbents whose leaders, not by coincidence, are all largely unknown to the public.
Apparently Tesla dropped 4680 battery production for the CT by 99%, so the CT isn't long for this world either.
But that's okay! They have the Cybercab that will 100% drive itself For Real This Time, $99/mo Autopilot/FSD subscriptions and robots that will theoretically wash your dishes in an age where most people have an adversarial relationship with anything AI, so.
I'm not disagreeing with your overall take, but Tesla and other EV manufacturers have released the same model of vehicle with different battery technologies at different times. Only saying that dropping 4680 production isn't conclusive proof itself.
The meme stock run up made Tesla more valuable than the rest of the auto industry combined. They HAVE to find something bigger.
I don’t think they have. Humanoid robots are a bad joke. But that’s why they are pivoting.
> Tesla's far more popular models are the 3 and Y, which accounted for 97% of the company's 1.59 million deliveries last year. The Model 3 now starts at about $37,000, and the Model Y is around $40,000. Tesla debuted more affordable versions of the vehicles late last year.
I’m confused as to what’s not clear from the article for you?
Agreed. I also thought it was a very dumb move until I saw that. That said, 3% but it costs 2.5x as much, maybe people option them higher idk, that could be a 10% revenue hit. But maybe that's worth it for them
If they just canceled the S and X I don’t think people would be making quite as much fun.
Saying they’re dropping two products that aren’t profitable so they can make a new product that most people seem to think is a complete joke is the problem.
The X and S were always very low volume niche products unlike the much more mainstream Y and 3. I wouldn’t read much into it.
I would. Someone in the market for a presumably profitable BMW 5 or 7 series isn't going to stay with BMW and drive a 3 series.
Yearly sales of model X have been comparable to the 5 series, at least until last year when musk's political activities took the shine off the brand.
High end cars are more profitable. There are millions of 3 and Y owners with positive experiences who would stay with the brand if it had something to move up to.
My 23 MX is the best car I've ever owned. I wouldn't buy the current iterations of 3 and Y.
Most refresh X owners think it's pretty great (not perfect). There are no alternatives at the moment, mostly because other manufacturers are terrible at software development...and that's not good for software defined vehicles.
It's sad to see Tesla walk away from the luxury segment so they can focus on robots, go karts, and robots pretending to drive go karts.
About a decade ago, Musk said he wanted to kickstart the electric car industry, make electric cars cool by showing they can be high performance and promising not to enforce Tesla's patents against competitors. Remember how electric cars used to be perceived? The Simpsons put it as "people will think you're gay". I'd say he completely succeeded in that goal and the whole "make piles of money for investors" is just because investors decided to try doing that.
Check out videos of Chinese car company factories. They are far more automated and futuristic than Tesla’s. Most of the new ones have almost no humans in them at all. They have great supply chains and partners for everything that is an input into these factories, and they’re often just up the street from the car factories. The costs are rock bottom and the competition between car companies in China is absolutely bananas.
Tesla and musk were living off of monstrous subsidies to the tune of 20B or more
Sure. And selling the most popular car on the planet is a failure?
Didn't the US government put ~$80b into rescuing GM etc, years ago?
Subsidies bootstrapped the EV industry. Stupid policies mean walking away from the investment, ceding the market to foreign competitors, and doubling down on legacy ICE crap the rest of the world no longer wants...and Americans will be less and less able to afford.
it's very difficult to have a conversation about this, because it would appear that sincere answers to your question will get downvoted. one POV is that, if you accept the bear case from Internet commenters that these guys are incompetent or stupid - blah blah blah, Cybetruck - the existence of their autonomous taxi product is extremely bullish. they managed to pull off something similar to Waymo despite being so much worse at it, yes? I'm not sure they will even need a diverse product line of premium cars, if they can sell an autonomous 3 for the price of a small house. on the flip side, the bear case there is, if they could figure it out, so will a lot of other car companies. and yet, Cruise ceased operations, and Tesla will seemingly pay a manageable amount of blood money for Autopilot and move on.
nobody really can predict the future, so unsurprisingly, "reading various articles about this doesn't make it more clear." but people on the Internet keep getting worked up about it. to me, people do not comprehend the meaning of "high risk, high reward."
Their autonomous taxi program is a joke right now, especially compared to Waymo. Way fewer cities/rides, and they haven't even deployed their cybertaxi thing.
Huh, so you’re telling me my car isn’t really driving me everywhere? I love how ill-informed most people here are. Makes me way more bullish on the stock
I love FSD and I know it well. I probably wouldn't feel super comfortable in a Tesla taxi. I've seen too much.
When Tesla started producing cars, everyone wanted what they proposed. Now, no one wants the cybertruck. No one is really asking for humanoid robots. Their self driving is vastly inferior to waymo when it comes to taxies, I can't see them winning that market. Their batteries and solar panels, like their cars, seem to be more or less abandoned.
So, it's pretty easy to see why people are confused and upset. Tesla is discontinuing all the things people like about Tesla, and selling vapourware that no one really wants anyways, instead. It's also not "a difficult conversation."
What seems more likely is that Musk, in his extreme shift to the right, has abandoned the original goal of Tesla: producing sustainable electric vehicles. He's become more and more delusional, with failing like the Boring machine and the Cybertruck starting to pile up. He's alienated his existing customer base by both getting into politics and dropping any pretext of trying to help the environment.
From my point of view, Tesla is a failed company with a leader who has gone off the rails, and a board that refuses to reign him in. Revenues are falling off a cliff outside of US governmental money, and it's betting the whole ship on only two ideas: self driving, which is so far no where close to being where it needs to be, despite the progress, and on yet another fairy tale that is humanoid robots.
The board cannot rein him in because doing so risks having the stock valued as a car company stock and not as a tech company or meme stock. I think they can only fix this after the stock has crashed.
imo their competition for autonomous vehicles doesn’t come from car companies, but from tech companies.
Amazon has a lucrative incentive to automate its supply chain up to and including last mile delivery. Waymo has proven out the tech and could easily partner with Uber or Lyft for the rider experience and reach.
If you’re FedEx, for example, would you rather buy from Amazon or from Tesla? Who is more likely to be a sane and trustworthy partner?
I don't think that Uber or Lyft are going to invest in self-driving taxis. The capital model is completely different: Uber and Lyft are by design capital light, they own nothing more than the software (1), and someone needs to buy all of these self-driving machines and then someone needs to maintain them, whereas their current model doesn't do that- they can't offer that to any tech partner.
The reason that you don't see more Waymo areas has nothing to do with rider pool or experience, it is because their tech requires pre-mapping everything with LiDAR several times- the advantage is that if you know what is static (because it was in all of that LiDAR mapping) then a simple difference algo can tell you everything that is dynamic in the environment. (Also, they are just starting to hit cities with significant precipitation- SFO, LA, ATX, PHX are all pretty dry cities, they are going into ATL, MIA, DC, DEN, etc.)
1: With a lot of suspicion that much of their profit comes from drivers not understanding depreciation of their vehicles, something that the accountants who work for Uber and Lyft will understand very very well.
Uber spent billions trying to make self-driving work, until they gave up. Not "by design".
Uber, and to a lesser extent Lyft, has been an extremely prolific investor in the autonomous vehicle space. They're absolutely paying attention to it.
Similarly, Waymo isn't bottlenecked by mapping or rain. I've seen enough of them testing in Seattle and Tokyo, as examples.
> they managed to pull off something similar to Waymo despite being so much worse at it, yes?
similar?! what exactly is your definition of similar? tesla and waymo are so far apart that it is difficult to accept any argument that tries to make this comparison. they cannot co-exist in the same sentence unless to explain one’s success against the other’s failures
Can you elaborate for those less familiar with the successes vs failures?
- https://x.com/Waymo/status/1924931187274826077
- https://x.com/Waymo/status/1945106097741664630
will leave it to the astute reader to look up “robo”taxi
Just a reminder that Tesla has still not offered driverless robotaxi rides to the public.
At this point, it's entirely because Musk refuses to add LIDAR. If he did they could probably be competing with Waymo in a year.
His rationale seems to be validated by Nvidia following the same strategy, no?
Nvidia follows the same strategy because having a large end-to-end model is how you get your customers to buy GPUs with their AI slush fund (and I don't think they limit themselves to vision).
His rationale at this point seems to be mostly stubbornness, coupled with a healthy dose of anxiety when he considers how much money he'll have to spend to deliver FSD to the people who bought it 10 years ago.
EVs are becoming commoditized. Tesla doesn’t have the scale ( or experience ) to play that angle.
literally what are the gigafactories for then?
Batteries - lots of uses beyond EVs, but lots of EVs are making use of the batteries they can produce, as well.
you could make the same argument about batteries. Panasonic and other exist.
The benefit of having control is that they can adapt them to their priorities. Similar Apple designing its own chips when there were already viable producers in the market.
They won’t need to rely on others prioritizing their priorities, like low volume, high cost early investments in batteries designed for a market (humanoid robots) that doesn’t exist.
If they then scale them up, they also have the benefit that there is no 3p supplier who can turn around and sell those to a competitor.
You should probably keep reading.
Elon for years has said Tesla is not a car company. He’s also said the “factory is the product.” Tesla also has energy divisions and investments, as well as xAI investments now.
Logically given that Model S and X are something like less than 5% of deliveries (and have been for years), if they’re right about Optimus, that capacity will generate far greater revenue.
Do they have enough people to remotely operate that many Optimuses?
They can probably hire enough random dudes in India, especially if AI reduces the need for call center employees.
It will be slightly creepy when the Optimus walks into the bedroom and stares while its owner is ... in the middle of something, but that's a small price to pay.
Plus the Tesla employees in the U.S. will also be able to share the video, so it's a win-win.
> if they’re right about Optimus, that capacity will generate far greater revenue.
How many Cyber Trucks were they supposed to sell?
Yeah. And that was a car. A thing that is at least a category people buy.
It’s scary how ignorant the hackernews crowd is when it comes to Tesla. I realize it’s due to Elon hate, but it’s very eye opening
Optimus is complete vapourware. The quoted 1M units a year would be utterly unbelievable from any company, let alone Tesla with their history of over-promising.
Its not that strange; normally manufactures are focused on volume and brand. So you have the 3 and Y in numbers where they can compete in the mass market price range; and CT and FSD for brand notoriety.
S and Y are not special enough to do anything for the brand, they dont qualify as halo products anymore. Probably still wouldnt be that interesting even if refreshed.
CT is still interesting, it looks different and has some tech inside that seems worthwhile to iterate on.
And unlike traditional brands, tesla has FSD, Optimus, and Musk to do enough to keep the brand itself healthy.
My guess would be they are deciding what they can learn by iterating the CT, and might decide to drop it in a year or two when the roadster takes the halo role.
They will keep trying to improve on volume for 3 and Y.
So is the new roadster just not happening?
Tesla designer I know said that it’s not something that anyone is currently working on.
As such, my guess is “not any time soon”.
On the earnings call Elon said
“we’re hoping to debut [next gen roadster] in April, hopefully. It’s gonna be something out of this world.”
(I’m just the messenger, don’t shoot me)
Makes sense and it sounds like Optimus is getting ready for prime time.
Are they betting Robotaxi will replace all cars in the future?
They need more room to make the next stock pump scheme look legit.
I'm sure they already have enough inventory to last a while and demand is probably cratering because of Elon's Twitter posts and the fact that Tesla never refreshes their models.
They've just refreshed their Model 3 and Model Y within the last year or so. With the model Y looking considerably different so I'm not sure where you got that from
I can give you the Model Y but take a look at the rest of the lineup compared to when they were first released. Hell, you're in this very post calling the S/X old.
Elon's $1T tranches are mostly based on market cap, right? Switching from just a carmaker to a "physical AI" company could be all he needs to convince the stock market to ignore Tesla's declining profits and raise the market cap even higher.
he’s done it time and time again and I don’t see him failing this time either.
The market for humanoid robots hasn’t been established like the market for $40,000 personal transport.
Saying that, I wouldn’t be too surprised if robotaxi replaces 90% of taxis and Ubers in the next 5-7 years.
But yea, stepping from sinking raft to the next…
Potentially in a few cities with high cost of living and nice weather, but certainly not worldwide. Not even the best can handle bad weather yet.
> Saying that, I wouldn’t be too surprised if robotaxi replaces 90% of taxis and Ubers in the next 5-7 years.
How about we start with 0.00076% first before we start throwing insane numbers like 90% (chance of which happening are in-line with me marrying Beyonce)
Why is it seen initially so negatively?
There's nothing inherently wrong with a company deciding to stop producing models that are extremely old, have newer comparable models that are more widely available globally and sell multiples more of. So why would you keep those older models?
If anything its a good thing. But its Tesla so nothing they do will be spoken positively of.
> Why is it seen initially so negatively?
Because Tesla is being measured against the benchmarks they set for themselves. It's not a good look with cancelled models, declining sales, and a lot of self-inflicted brand damage.
Musk used to claim Tesla will sell 20 million vehicles per year:
https://www.reuters.com/business/autos-transportation/tesla-...
The new goal is to have sold 20 million in total by 2035. That target represents a further decline in sales. And, given that Tesla over-hypes everything, maybe they won't achieve it:
https://www.nytimes.com/2025/09/05/business/elon-musk-tesla-...
> Why is it seen initially so negatively?
They went from being able to profitably produce a luxury car, to not being able to profitably produce a luxury car, to not being able to produce a luxury car at all. All while becoming uncompetitive in the econobox market, and losing huge chunks of it even before their real competitors arrive in market…
Yeah, in Europe Tesla is not losing to BYD. They are losing to VW and BMV before the Chinese manufacturers have entered the competition for real.
But they’re making a robot! It will totally save the company!
On top of all the problems you have identified, as well as more, they’re clearly now just aiming for fantasy land.
I'm not surprised at the X, but the S has always been the flagship model with all the best features and the top performance. The 3 is a fine mid-sized car but it's very strange to get rid of your flagship model. Those always cater to a small audience anyways.
Yes, flagship models aren't intended to be good sellers. They often are where new features are tested out on customers willing to overpay to be early adopters. Tesla did test out the new steering yoke and removing the control stalks in the S: both features were met with tepid reception and partially rolled back. This is also bad for the 3 and Y, since there will be low confidence in any changes before they are released.
I guess from my perspective you can't buy the S or the X in Australia, all I see everywhere are the 3 and the Y. So for me its not flagship but I do know that the S was the original popular Tesla and has all of the bells and whistles.
As a car company the expectation is that they develop new car models for consumers. They don’t seem to be doing that either.
They developed the Model 3 and Y, which is partly why they're stopping the S and X?
They completely refreshed the Model Y last year and made a number of updates to the Model 3 including different body word.
But the 3 isn’t comparable. It’s cheap, looks cheap and feels cheap.
Someone who owns a BMW 5 series isn't going to switch down to a new model of the 3 series. The X makes the 3 and Y feel like go karts (that are slow). The S is a missile. Fun, but not for me.
The other way of looking at this: The X is the only Tesla model with door handles that aren't stupid.
Will they increase specs on the 3 and the Y after the S and X are sunset?
Ford got a lot of heat for shifting all of their NA production to Mustangs and F-series trucks too a few years ago.
Ford didn’t say it was so they could make a robot butler instead.
The reason was sillier: China forced Ford to sell Mazda to enter the Chinese market, because Mazda entered the Chinese market before Ford and China considered them the same entity subject to the same outside manufacturer limits).
Mazda handled the small vehicle chassis design for Ford. So without Mazda, Ford no longer had the knowledge for continued development of their sedans and crossovers based on sedan platforms.
Toyota sells a lot of Camrys and Corollas. It is nice that they also make (made?) Supras and 86s.
Also we can have a conversation without tossing the "everyone hates Tesla!" poison down the well immediately.
The difference there is that Supra's and 86's are performance cars, whereas Camry's and Corollas arent. You can't compare a Hatchback to an 86.
The Model S is comparable performance to the Model 3 performance.
My point is that the latest models 3 & Y are more affordable alternatives to the S & X and more widely available globally.
Okay that's my ignorance of Tesla models then, I assumed the more expensive models were also faster.
I guess then it's more like Toyota EOLing Lexus or GM getting rid of Cadillac.
I understand the point that the cheaper models are higher volume. Historically that had not precluded the creation of sports and luxury models for most manufacturers. Are the legacy brands wrong to do this? Currently I doubt their business acumen far less than Elon's.
The model 3 performance model does 0-100 in 3.1 seconds, the model S does that in 2.1, it is therefore faster by a second but 3.1 will beat most cars off the line quite comfortably. The Supra for context does that in 4.1 seconds.
Nothing wrong with keeping a sport and luxury model, however I would argue that the latest models are quite sporty and luxurious in their own right.
Companies like Ford constantly discontinue models, but they don't get the level of attention Tesla does.
If Tesla aren't seeing the Model S and X being sold to anywhere near the degree of the 3 and the Y, then why continue making them? They aren't as globally available and its clear people don't want them as much as the others.
I think we're sort of back at the beginning here. They are welcome to focus on their bestsellers. Traditional automotive wisdom would favor halo models and upper trim models so people can boast about a sedan that can out-drag a Supra.
> Companies like Ford constantly discontinue models, but they don't get the level of attention Tesla does.
If they axed 2/5 of their models it might. But they're also not run by an attention wh- addict with an Apple-like fanbase.
Oh and also they're axing 2/5 of their models to build teleoperated robots. Seems like the attention is well deserved here.
Having a halo product can be inspiring. A lot of BMW buyers may get a boring old 3 series but they like that the low volume M cars exist, for example.
Just buy an i4, even the eDrive is pretty zippy 0-60 in 5.4 seconds (the M50 can do it in 3.1 seconds). I’m not sure what the M car EV will look like beyond a motor for every wheel, but I can’t really see a point to it.
You are, of course, exactly right but you will nevertheless be downvoted for the same reasons you allude to.
> “If you’re interested in buying a Model S and X, now would be the time to order it.”
I can't tell if this is real and he realizes the traditional luxury brands have beaten him or if he's just using the classic rug store sales tactic.
Is that an international thing? There was a rug store next to where I grew up in Stockholm which had a sale because they were closing the shop from at least the early 90s until ca 2020 during covid when they closed the shop for real. There are also a couple more rug stores doing the same thing, one of them still to this day.
It's an international thing, down to the neverending "Closing now fr fr" sales. There was general bemusement in Sydney when one shop notorious for this actually closed down, but only because the building was demolished to make way for a highway interchange.
https://www.smh.com.au/business/consumer-affairs/rozelle-rug...
In many countries, "carpet salesman" is equivalent to "used car salesman" as the least trustworthy occupation imaginable.
"Buy the software-dependent product we're not going to support going forward!"
Also, good luck if you ever need replacement parts.
Absolutely. Tesla's already shown significant disdain/deprioritization for replacement parts in models they're not discontinuing. After all, every part in a service warehouse is not a part going on a new car to pump the quarterly numbers (or be parked in an abandoned shopping mall).
This is sad in that I was serious about finally getting one in two to three years (We have two Model 3 LRs already), but is fantastic in that no other car interests me and I now don't have this hyper materialistic goal distracting me.
If Tesla completely exits automotive and decides to license their FSD tech (or someone else catches up), then I'll probably just get whatever the equivalent of a Bolt is then with that and premium sound.
And they just might, too. Recall that the EV tax credit went away this year along with regulatory credits to other auto OEMs, which was a huge part of their business. This combined with the Cybertruck (unsurprisingly!) missing sales targets is problematic.
> This is sad in that I was serious about finally getting one in two to three years
Couldn't have said it better
Probably one of the dumbest decisions taken by a CEO?
No more S3XY lineup of models? I'm surprised Musk was okay with breaking that up.
3YC is the new S3XY.
YC3.
CYR3S, if we're going to add Roadster and Semi, both of which are allegedly still in development.
I'm almost surprised they didn't end model 3 production too. Benefit would be much smaller since 3 and y are already so similar.
"HN is dying" is a cliche, I know, but I seriously want to bookmark this thread to revisit it in 10 years - I'm sure it will age even better than (in)famous Dropbox thread. So from that perspective, HN is alive and well :).
The level of cynicism of the discussion is overwhelming, frankly. I get it that some people don't like Musk because of his politics, but why should that prevent people interested in technology to at least try to present a steelman case?
Let me try it, at a risk to be down-voted to oblivion...
1. As people correctly point out, S&X are outdated, low volume models. Investing more engineering time in them doesn't make any business sense; these engineering resources and capital should be clearly redeployed elsewhere.
2. People think that Waymo is supposedly better(?) than FSD, but at least some very well informed people (and NVIDIA as a company) believe that it's not. Personal anecdote: an older (HW3) version of Tesla drove me perfectly well in Yosemite last weekend, in on winding mountain roads with 0 cell phone coverage. It will take Waymo forever to map everything there properly with LIDAR, and true autonomy only in selected metro areas has limited value.
3. It's obvious that when we have autonomous, general purpose humanoid robots, they will completely transform our societies. Any such robots would require an enormous AI/vision investment. Say what you want about Elon, but xAI basically caught up with the top LLM shops in ~18 months, and now have comparable AI training capacity. You can bet against Optimus, but who else would have the skills to bring both the technology and the AI to market first? China? Good robotics, but no enough data to train their vision models comparing to Tesla, at least not yet.
4. So the bear case is that (a) driving autonomy is not possible without LIDAR, (b) Tesla can't bring another very complex product to market, and (c) autonomous robots are not possible in our lifetime. If you look at the AI progress even in the last 12 months, that's a tough sell to me.
What are the serious, tech-based counterarguments to the points above?
Dropbox really was shit, the fact that we lampoon the HN anti-Dropbox guy is evidence that this place died long ago. You really could have just done it with rsync and I'm so glad Claude Code exists to kill every other shit SaaS business that doesn't deserve to exist. Dropbox first please.
Hard to tell whether you are serious or sarcastic, but assuming it's the former: my contrarian position on CC vs SaaS is that in the quest to kill shitty businesses people will discover that creating a high-value SaaS is very non-trivial. CC would kill a whole category of low effort SaaS while at the same time substantially raising the quality bar for SaaS that people are willing to pay money for.
> converting Fremont factory lines to make Optimus robots
I’m very bullish on humanoid robots, but this seems absolutely batshit insane to me. These things are no where near ready for full scale production.
If the can walk and randomly fire teargas and bullets into crowds of protesters they could replace half of ICE right now.
Elon Musk says something absolutely insane on the weekly. Almost none of it actually happens.
That’s just nonsense, of course. Almost everything he says happens. It rarely happens on time.
Almost everything he says happens? Thats pretty far from the truth. Isn't Tesla still embroiled in a legal tussle over "full self drive"? What about the $30k model 3? What about the $200/kg to space?
He has very little connection to the truth. He's a hypeman and a conman
There are driverless Teslas roaming Texas giving rides _right now_. It happened. It was late, and there will be some fallout for HW3 compatibility with unsupervised FSD, but it happened.
Tesla still doesn't have full autonomy. They've been lying about it for a decade:
https://en.wikipedia.org/wiki/List_of_predictions_for_autono...
https://electrek.co/2026/01/28/teslas-unsupervised-robotaxis...
https://electrek.co/2026/01/28/tesla-is-still-trying-to-dece...
Is that actually true? I know they announced it, but I also saw stories that no one seems to be able to actually find one of these...
On a scale of “happens” on one end to “doesn’t happen” on the other, he has a few “happens” that Elon fans will try and anchor against the weight of the enormous load down at the “doesn’t happen” end.
A few of the things he says will happen, happen. Many of them happen late.
Most of what he says will happen never happens, but people point to the few things that did happen, but were late, and say, "This too will happen."
Feels a lot like giving up. I guess this is why there is such a strong change in the Tesla messaging, to Robotaxis and robots. But maybe this is inevitable. The cars being made in China are pretty amazing and I don’t think it is possible for American or European companies to compete.
We outsourced it and it would take us 10 years to retool and rebuild that kind of capability. No one wants to take that kind of investment on.
The narrative from Musk cultists has been "Tesla isn't a car company, it's a bet on $excuse_du_jour" for at least a year and a half.
I am surprised that nobody here is talking about grid energy storage, they basically invented that business vertical. It's about 13% of their revenue.
Certainly longer than that. I actually thought Tesla as an energy company made sense — sadly just an excuse to buy and shelve solarcity.
Nobody here seems to remember that this was always the plan: release expensive cars to bootstrap the company which allows them to release progressively cheaper cars until everyone can afford one.
Not a fanboy, but this seems like it went exactly according to plan.
Nowhere in that plan was "only produce cheap cars." Unless you're aim is to be the budget brand, it's bizarre behaviour not to have a top end flagship model.
Which phase of the plan talks about repurposing the cheap car factory to make humanoid robots?
Where exactly are those cheaper cars? Still waiting for a 30k model 3 like promised.
You already have it. Musk's earliest promise of a $30k price point appears to be an interview in September 2009: https://www.wbur.org/onpoint/2009/09/25/teslas-elon-musk-on-...
Adjusted for inflation, $30k then is around $45k now. Tesla sells a Model 3 for just over $35k.
It doesn't make any sense to hold someone to a promise like that and not adjust it for inflation. I think you can legitimately complain that he didn't meet the timeline he was aiming for.
I think your point is fair, but look at the 2026 Nissan Leaf.
The base is around $28k. This feels like one of the first "affordable" EVs in the USA. It also comes with decent tech without a subscription, and has comparable ranges to Teslas.
Yes. It's interesting to see a consequence of this strategy, which is at least some part of your model 3/Y customers bought it because "it is a Tesla", and being Tesla is premium. If you get rid of the premium, you lose that aura. But maybe the impact is small.
Tesla's secret weapon will be the dyson sphere. Probably complete within 2.. 3 years maximum.
X sure, but the S? it was the best in the lineup
why not kill the cybertruck instead?
The S is simply too expensive. People in the market for $100K+ sedans/coupes are gonna perceive more curb appeal from a Mercedes, Audi, BMW or Porsche.
Tesla crashed the allure of its brand by lowering the price point of the Y and 3. The X and S aren’t different enough to attract $100K+ purchasers.
(It’s one reason why Toyota and other brands use different marks like Lexus for their high end offerings).
Roadster will replace S
The same vaporware Roadster that was supposed to come out years ago and that Tesla has not shared any updates on?
It seems fairly easy to find figures on how many cars Tesla has produced each quarter but, surprisingly (at least to me), it's harder to find compiled information on (for each quarter):
- Average Selling Price;
- Cars produced vs cars sold;
- How many unsold cars are in inventory. I did find this [1];
- A model breakdown of the above 2.
The reason I'm interested in this because my theory is that:
1. Sales have been shifting from the Model S/X to the Model 3/Y, which reduces average selling price and overall profit. Stopping production is really about the inventory glut;
2. Unsold inventory is going up, particularly for the Cybertruck; and
3. Tesla marketshare is collapsing in many markets due to a combination of brand collapse among the most likely EV buyers and competition from lower-priced alternatives, particularly Chinese EVs in developing markets.
So what exactly is propping up this company at an above $1T market cap?
[1]: https://electrek.co/2025/06/17/tesla-tsla-inventory-overflow...
While this isn’t sale price data, it should be pretty close, and the trends should be clear:
https://docs.google.com/spreadsheets/u/0/d/1F5IQOynIawoXiJPV...
I’m a little sad (nostalgic?) about this decision. Model S is a truly historic vehicle.
Dropping the S and X is going to kill the market for them. Who is going to buy a car that they know is getting discontinued?
Including Cybertruck, it's just 2.75% of sales
Q4 sales: Model 3 & Model Y: 406,585 deliveries All Other Models (S/X/Cybertruck): 11,642 deliveries
Carmakers discontinue models all the time. The support network is still around, and parts will still be produced for a while.
Yeah but most companies have a few dozen models, Tesla has 4.
Given the product splits, Model S and X served no further purpose besides taking up production capacity. If that unlocked capacity is used for more Model 3/Y builds or other product lines, then that would be a net positive for the company as opposed to continuing on with S/X for the sake of having product range.
It's not like they aren't going to support any new purchases.
S launched in 2012.
X launched in 2016.
Both launched with slow rollouts.
Meanwhile, the average car in use today is 13 years old and getting older. (I currently drive a 22 year old car)
It definitely turns me off buying a used model S to know it's being discontinued. And if I extrapolate that to the 3/Y, a new purchase.
Given my desire for a midsize family sedan, it makes it feel like BMW i4 or Porsche Taycan just won me over in the future.
Tesla has no moat - but one thing I will give to Elon is his incredible strategy in building Tesla
1. Build sports car
2. Use that money to build an affordable car
3. Use that money to build an even more affordable car
4. While doing above, also provide zero emission electric power generation options
he got distracted by side-missions, his personal shitty side
however if you separate the ideas from the person you can see how such a simple strategy was executed successfully
The thing is it’s hard to stop at 4.
5. Peace out from Tesla for a while to pivot hard into far-right politics, using outsized power and influence to wage culture wars, alienate core customers, and inject volatility into a brand that was built on trust, optimism, and engineering credibility.
6. Unveil Optimus as the next grand pillar of the vision, not as a shipping product but as a perpetual demo, a future-shaped distraction that soaks up attention while core execution, margins, and credibility quietly erode.
Is there another car out there in the US that has a way to type in an address, tap a button, and it drives you there? All other car manufacturers software is terrible.
it’s not a difficult strategy to come up with, tbh. tech companies do this sort of thing all the time.