Tesla axes EV models in drive for robotics revenue

Tesla is to axe accumulation of 2 electrical conveyance (EV) models arsenic portion of a displacement towards robotics aft the institution reported its archetypal ever diminution successful yearly revenue.

Chief enforcement Elon Musk told analysts connected a league telephone that the institution would halt selling its older Model S and Model X vehicles and person mill abstraction to manufacture its Optimus robots instead.

Tesla revealed that concern would much than treble this twelvemonth to $20bn (£14.5bn), with $2bn of that sum going to his artificial quality part xAI.

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The spending seeks to marque bully connected a bid of promises by Musk relating to Tesla's modulation towards self-driving cars and robotics that have, truthful far, fallen abbreviated of targets.

Musk's plans to physique Cybercabs - robotaxis - person been hampered to day by a deficiency of capableness and regulatory clearances.

He has antecedently warned that a shortage of representation chips amid the wider unreserved for AI globally, risks hampering accumulation arsenic it ramps up precocious this year.

Tesla is looking to caller gross streams arsenic its accepted EV abstraction becomes ever much crowded, with China's BYD overtaking the institution past twelvemonth to go the world's biggest EV maker.

The US company's revenues and profits suffered successful 2025 arsenic halfway EV income were battered by a backlash against Musk for his cost-cutting relation astatine the bosom of the Trump medication and interventions successful overseas elections.

The income Tesla did marque were connected the backmost of steep discounts, reflecting not lone the often convulsive boycott of Tesla by governmental opponents but besides the information that vehicles made by Tesla's competitors are cheaper.

A US taxation inducement for electrical vehicles was besides ended by the Trump medication amid Musk's on-off narration with the president.

Tesla shares were up by 2% successful after-hours trading - gathering connected cautious gains of past twelvemonth that person been mostly explained by the AI-driven turnaround plans promised by Mr Musk.

He is nether unit to conscionable a stock price-based inducement plan, perchance worthy up to $1trn implicit 10 years, but determination are fears among immoderate investors that his absorption is dispersed excessively thin.

Musk plans to instrumentality his rocket institution SpaceX public, perchance successful June.