Fremont Ready to Wave Goodbye to Tesla Models S and X, Welcome Its New Robot Overlords

Fifteen years ago, Tesla began production of its Model S sedan in a shuttered auto plant in Fremont.

At the time, the company was a fragile startup on the verge of collapse. Most major automakers didn’t even consider EVs as serious competitors in the mainstream market.

Now, the trillion-dollar company is poised to churn out a different edge case product on the plant’s assembly lines: its humanoid robot known as Optimus.

“They took a factory that was one of the oldest operating auto factories in the country and turned it into the most productive auto plant in North America,” said Donovan Lazaro, Fremont’s economic development director. “I would imagine they’ll have that same fiery tenacity when it comes to rolling out Optimus.”

CEO Elon Musk said Wednesday that the automaker is ending production of its Model S and X vehicles at the factory to free that part of the space to build Optimus, but overall auto production is not ending in Fremont.

“It’s time to basically bring the Model S and X programs to an end with an honorable discharge,” Musk said on the company’s fourth-quarter earnings call, “with the long-term goal of having 1 million units [a] year line of Optimus in the SX space in Fremont.”

Today, the Fremont factory employs 30,000 people to build four Tesla vehicles: the S and X for now, but also the newer Models 3 and Y. The Model S was the first vehicle built at Tesla’s Fremont factory, but the S and X lines accounted for only 3% of Tesla’s global production in 2025.

To see them sunset is a symbolic loss, but it is not expected to be much of an economic loss for the company or the region.

“We’re making big investments for an epic future,” Musk said of the switch.

Musk said Tesla expects to increase headcount at the Fremont facility as it builds out robot production and “to significantly increase output.”

Tesla is already hiring for the Optimus work, and Lazaro said he believes most of the people trained in the Tesla way will stay put through the retooling.

“While I can’t speak with granularity to Tesla’s plans, I will just say in general we have a shortage of skilled labor in this country, especially for manufacturing and advanced manufacturing jobs,” he said. “And so I would absolutely imagine that there will be roles found in other parts of the facility for any affected workers.”

Lazaro added that a new product line will require a new supply chain, which could attract all sorts of new suppliers to the region. Tesla is also leasing additional space near its existing factory to support the company’s work in AI, engineering, and, of course, robotics.

Fremont Mayor Raj Salwan said city officials are “delighted” by Musk’s announcement.

“Tesla’s Fremont facility evolving into robotics manufacturing is a vote of confidence in our workforce, supplier ecosystem, and advanced manufacturing base,” Salwan wrote to KQED.

Tesla said it plans to unveil the third generation of Optimus later this quarter, calling it the company’s first design intended for mass production, intended to be used for factory work, household tasks and caregiving. Musk said on the conference call with investors and analysts that he expects artificial intelligence to usher in an era of “sustainable abundance” in which robots do all the work and “everyone can have whatever they want.”

He’s also said he imagines one for every person on Earth, all of them running Tesla software. But that may have more to do with his desire to justify his outsize Tesla pay package, involving up to $1 trillion worth of Tesla stock, than his penchant for predicting the future.

Musk’s personal move to Texas in 2020, his decision to move SpaceX and Tesla headquarters to Austin in 2021, his takeover of Twitter in 2022, his support for the Trump administration and leadership of DOGE in 2025 have alienated many Californians. His promotion of Tesla’s controversial “self-driving” technology, despite documented accidents and safety concerns, has led to criticism and lawsuits.” The same is true for his cavalier approach to complaints about xAI.

Additionally, it’s not clear how many people on Earth will feel a driving need to purchase a robot.

It’s no matter to Stephen Baiter, executive director of the East Bay Economic Development Alliance.

“They really are leveraging all the plentiful assets, resources, the talent and everything else that makes the Bay Area such a unique and global powerhouse,” he said. “I think their capacity to fulfill their bigger ambitions over time is realistic. What time horizon, I guess, remains to be seen.”