After weeks of anticipation, Tesla’s production of the Model S sedan and Model X SUV is nearing its end, with only a few hundred units left unsold. CEO Elon Musk confirmed via a post on X that custom orders for these models have concluded, leaving merely leftover inventory available. This termination of production aligns with Musk’s prior announcement from January.
Sales of the Model S and Model X have consistently declined, attributed to the rise of Tesla’s more affordable models, the Model 3 and Model Y. The two previously flagship models peaked at over 101,000 deliveries in 2017 but have plummeted to around 50,850 units combined in 2025, significantly overshadowed by the over 1.6 million vehicles Tesla delivered globally last year.
With the discontinuation of the Model S and Model X, Tesla is not opting for a traditional EV replacement. Initial plans for a cost-effective model below $25,000 have been scrapped in favour of the ambitious Optimus robot and the Cybercab, a two-seater autonomous vehicle prototype first revealed in 2024. Production of Optimus is slated to begin at Tesla’s Fremont factory after the two models end, with Cybercab manufacturing commencing this month in Austin.
The Model S and Model X were groundbreaking, marking significant milestones in Tesla’s evolution. The Model S was launched in 2012, reshaping public perceptions of electric vehicles and prompting competitors to reassess their strategies. The Model X followed, known for its complicated features and delays but ultimately broadening Tesla’s appeal, especially among female consumers.
Both vehicles laid the groundwork for Tesla’s mainstream success, particularly with the Model 3 defining its position in the market. Despite ongoing sales of the Model 3 and Model Y, the company has faced a troubling downturn, recording fewer overall sales for two consecutive years. In early 2026, Tesla managed to improve slightly with 358,023 vehicle deliveries in the first quarter, though still failing to meet analyst expectations.
Musk continues to position Tesla as an AI-centric company rather than simply an automotive manufacturer. The upcoming Cybercab reflects this AI focus but carries considerable risks. Designed without traditional driving controls, its rollout will depend heavily on Tesla’s Full Self-Driving software, which has yet to demonstrate consistent reliability.
Regulatory challenges loom large for the Cybercab as federal safety standards currently mandate essential controls absent in its design. Furthermore, operational permits for driverless vehicle deployments complicate its launch. Competing autonomous vehicle companies, like Zoox owned by Amazon’s Jeff Bezos, have received exemptions to operate vehicles lacking traditional controls, possibly paving the way for Tesla.
Musk has reassured stakeholders by positing that autonomous travel will dominate the future landscape of transportation. He estimates that only a minimal percentage of journeys will involve manual driving, bolstering the case for the cost-effective, AI-driven Cybercab initiative. As Tesla navigates this pivotal transition, the company’s next steps could redefine its trajectory in the automotive and technology sectors.
Fanpage: TechArena.au
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