At the Detroit Auto Show in 2011, the Tesla stand was mobbed. With its 17-inch screen, staggering acceleration and sleek looks, the Model S sedan wowed a new generation of tech-savvy buyers and redefined electric vehicles as performance cars.
Just 15 years later and the Model S is finished, along with its equally dramatic, gull-wing-door SUV doppelganger, the Model X. Cue the Optimus robot.
In Tesla Inc’s January earnings call, CEO Elon Musk shocked the auto world in announcing the wind-down of Model S/X production. Manufacturing capacity in Fremont, California, will be converted to robot assembly – consistent with the company’s trillion-dollar market valuation based on expectations it will transform the US market with autonomous humanoid and auto robots.
But leaving behind the Model S also impacts a passionate legion of auto owners Tesla has courted since 2011. Like General Motors Co’s Chevrolet Corvette, Porsche AG’s 911, and Ford Motor Co’s Mustang, the Model S is Tesla’s halo – the performance car that defined brand capabilities.
The transition away from personal transportation toward robots is a pivotal moment for the company’s mercurial CEO and the cult-like customer base that has followed him.
“It’s sad in that it’s the end of an era in terms of what it did for the EVs,” said Joel Szirtes, 46, of Birmingham, who was an early Model S adopter and Tesla investor. “Now comes the robot transition. If you look at what Musk’s done with Full Self Driving cars in just the last 10 years – self-driving, cameras on cars observing the physical world, artificial intelligence – the logical next iteration of this is Optimus.”
Since he bought his first Model S in 2012, Szirtes has owned every Tesla from Model 3 to Cybertruck (he currently owns two Model Ys). He has also seen Tesla stock soar by over 300-fold – meaning a US$1,000 (RM3,954) investment is worth US$260,000 (RM1mil) today. Since its IPO in 2010, Tesla’s market cap has grown from US$1.7bil (RM6.72bil) to US$1.3 trillion (RM5.14 trillion).
Many of Tesla’s 7 million owners have turned their passion and knowledge of the company's products into market wealth. Could personal robots engender the same passion?
The Optimus robot “will have a very significant impact on the US GDP (though) there are still many who doubt our ambitions for creating amazing abundance,” Musk said on Tesla’s Jan 28 earnings call.
Sean Maloney of Grosse Pointe bought his first Model S in Chicago in 2012 at a time when Michigan banned Tesla sales. “It's only surprising in that it seems like (S and X) were halo vehicles for the brand. But with a company led by Elon Musk, things shouldn’t be surprising. I think back to when I made a reservation for (the) Model S in 2011. For me, it's still the vehicle that redefined what an EV could be.”
Dan Markey of Rochester Hills has owned seven Teslas since 2013 – three of them Model S including the Plaid, the first production vehicle to hit 60 mph in under two seconds.
“Being such a fan, it’s really kind of sad, because it looks like they're leaving the traditional car business,” Markey said. “They still talk about the Roadster (a sports car with even quicker performance numbers) coming out, but that's been delayed so long anyway. I’m concerned that maybe that's their last new vehicle.”
The Model S wowed retired GM engineer Dick Amacher of Rochester Hills when it debuted. He bought six of its more affordable variants, the Model 3 and Model Y – as well as the company’s stock. He currently owns a Model 3, which he has nicknamed Earl Grey, and a Y nicknamed Jack Black.
“I have mixed feelings,” said Amacher, who said he feels safer today when his Teslas drive him on FSD. “Cars are still a fashion statement. The EV advantages are palpable, never mind the green narrative. I haven’t had an oil change or a brake job in the last 150,000-plus miles and my cost per mile for energy is about one-third that of gasoline. I love it.
"The financial math would have to be compelling for me to ever want to ride in a Robotaxi (Tesla’s autonomous rideshare service currently in Austin and San Francsico), but maybe I will get too old for a driver’s license.”
The financial math for Tesla appears a no-brainer given its market cap as one of the US stock market’s Magnificent Seven – companies driving the US economy to an AI future.
"This appears to be a strong indication of Tesla’s strategic repositioning from vehicle hardware to AI/robotics,” said former Ford chief engineering director Stuart Taylor, now chief product officer at Envorso, a tech consulting company. “This is where Tesla believes autonomous systems, robotaxis and humanoid robots will provide future growth and differentiation. This reflects a shift from a traditional (auto manufacturer) business model toward software, service and data-centric platforms.”
The digital age brought an electronics revolution to automobiles, with Tesla at its bleeding edge.
Terms like “autonomous driving,” “one-pedal driving” and “Ludicrous Mode” became part of the popular auto lexicon. The line between automotive and software companies blurred with Google’s Waymo division outfitting Jaguars and Chrysler minivans with self-driving tech. General Motors was the most aggressive automaker – changing its corporate motto to “Zero Zero Zero” and promising an autonomous, electric future of zero crashes, zero emissions and zero congestion as it chased Tesla’s sky-high market valuations.
While GM has flirted with robot cars (through its defunct Cruise rideshare service in San Francisco) and outfitted its lineup of Chevy, Buick, Cadillac and GMC vehicles with Full Self Driving-competitor Super Cruise, Tesla appears to be going all-in.
“Repurposing the Fremont facility for the Optimus robot lines suggests Tesla is betting on new manufacturing footprints and supply chains that are fundamentally different from traditional automotive production,” said analyst Taylor. “Tesla’s language and investment in these technologies indicate that they are core to its long-term plan and a bifurcation of the traditional (automaker) business model.”
Whatever the long-term outcome of its robotic ambitions, Tesla’s passionate personal transportation customer base has seen its options reduced.
“I don't know what their product plans really are going forward,” said Amacher, who uses Tesla’s hands-free Full Self-Driving for over 99% of his driving. “I can't believe they're just going to sell the Model 3 and Y with no changes. The Cybertruck (introduced in 2023) was a flop. I wonder what (designer) Franz (van Holzhausen) is going to do?”
The US$57k Model S was a sensation when it came to market in 2012. Motor Trend Car of the Year. A record-high score from Consumer Reports. Pulitzer Prize-winning Wall Street Journal auto critic Dan Neil wrote: “(It’s) a spaceship. The Model S is the most impressive feat of American industrial engineering since, well, a couple of months ago, when Mr Musk's SpaceX successfully launched and recovered a spacecraft that rendezvoused with the international space station.”
It fuelled a Tesla community that grew by the millions as the more affordable Model 3 and Y were introduced in 2016 and 2019 in must-watch, Musk-hosted YouTube events. While small-volume Model S/X production gives way to Optimus in California, the high-volume Model 3 and Y will continue – the latter underpinning rideshare production along with the fully-autonomous, gull-wing Robotaxi.
Maloney bought one of the first 10,000 Model S cars made and has had three total, including the 2024 model in his garage today – right next to a screaming, six-cylinder, manual Porsche Boxster GTS.
“Musk’s always a couple steps ahead of the public and waiting for people to catch on,” said Maloney. “When I had my first Model S, people would wave me over in the road – including a police car once. They’d say: ‘What is that? I’d say it’s a Tesla, made in the USA.”
Would he buy another electric brand?
“The Model 3 today is a bit of a downsized Model S. It’s very good,” said Maloney. “The biggest thing for me is the Supercharger network . . . and the navigation system, which is far better than my wife's BMW X5 navigation.”
Owner Markey admires Musk’s acumen and thinks he’s taking the company where it needs to go.
“I've had my (latest) Model S for two years now, and there's nothing out there that's going to replace it right now,” he said. “Maybe they'll use the Model 3 for the next Plaid.”
Analyst Taylor said that Musk has positioned himself for the long game: “Auto manufacturers that are positioning themselves well for software, services, autonomy and AI capability will not see substantial near-term revenue – but will be better positioned for longer-term growth.”
Owner Amacher isn’t convinced.
“I think (Musk is) dead wrong on the adoption of autonomous ride hailing, just as he was dead wrong on the mass adoption of electric cars,” said the 77-year old, who will hold onto his Model 3 and Y. “Ride hailing is good for urban dwellers, but I want a car in the garage. Why would I sell (my) car and my FSD license so I could ride-hail a car?”
Robotaxi dovetails with Musk’s consistent vision of a robotic future.
“The future is electric autonomy. It will change things quite a lot.,” the CEO told Motor Trend in 2019. “Whether you like it or not, this is what's going to happen. But certainly for those that love driving, I don't think they will be prevented from driving, just like those who want to ride a horse, they are not prevented from riding a horse.
“But it will just be very few people that choose to do that.” – The Detroit News/Tribune News Service
