Tesla axes EV models in drive for robotics revenue

Core Viewpoint - Tesla is shifting its focus from electric vehicle production to robotics, announcing the discontinuation of the Model S and Model X to allocate resources for manufacturing Optimus robots, following its first annual revenue decline [1]. Group 1: Production Changes - Tesla will cease production of the older Model S and Model X vehicles to repurpose factory space for its Optimus robots [1]. - The company is facing challenges in its transition to self-driving cars and robotics, with plans for Cybercabs (robotaxis) hindered by capacity issues and regulatory hurdles [3]. Group 2: Financial Investments - Tesla's investment is set to more than double to $20 billion this year, with $2 billion allocated to its artificial intelligence division, xAI [2]. - The increased spending aims to fulfill promises made by CEO Elon Musk regarding the company's transition towards advanced technologies [3]. Group 3: Market Position and Competition - Tesla is exploring new revenue streams as competition in the electric vehicle market intensifies, particularly with BYD surpassing Tesla to become the world's largest EV manufacturer [5]. - The company has experienced revenue and profit declines due to backlash against Musk's cost-cutting measures and competitive pricing from rivals [5][6]. Group 4: Stock Performance and Investor Sentiment - Tesla shares rose by 2% in after-hours trading, reflecting cautious gains attributed to AI-driven turnaround plans [11]. - There are concerns among investors regarding Musk's ability to manage multiple ventures, including a potential public offering for SpaceX [11].