The Tesla Story
Tesla Model 3
(Mit freundlicher Genehmigung/Courtesy of Pixabay [tesla-5937063__340.jpg])
Management Summary
In early 2026, Elon Musk announced one of the biggest strategic shifts in Tesla’s corporate history:
- In a conference call with investors, the CEO made it clear that the former electric car pioneer no longer sees itself primarily as an automobile manufacturer.
- Instead of further expanding its classic vehicle portfolio, production capacities and investments are to be increasingly directed toward fully autonomous robotaxi services, software-driven mobility platforms, and the development of humanoid robots for industrial and logistical applications.
Elon Musk had previously driven what is arguably the most profound transformation of the modern automotive industry with Tesla, turning electric mobility from a niche concept into a global mass market.
Elon Musk can rightly be called the “Henry Ford of the 21st century” because he has been instrumental in driving forward the mass production of electric cars. The Tesla Model Y plays the role of the Ford Model T, the first car to be manufactured on an assembly line.
It is remarkable that Elon Musk does not come from the automotive industry and is neither the inventor of the electric car nor the founder of Tesla. Nevertheless, he has been very successful in repositioning the electric car:
- Electric vehicles have been around for over a hundred years, but have often been marketed by established manufacturers as ecological but uninspiring alternatives to combustion engines.
- Tesla, on the other hand, positioned its models as powerful and sporty vehicles from the outset, emphasizing their high acceleration in particular. As a result, electric mobility was no longer communicated as a sacrifice, but as a combination of driving pleasure and environmentally conscious behavior.
Tesla is also the first successful automotive start-up to originate in Silicon Valley. Before Tesla entered the market, the region’s start-up landscape was dominated by IT and software companies, while the automotive industry – especially in the US – was considered an established, less innovation-driven “old economy.” Elon Musk demonstrated that start-ups can also be successful in mature industries if they coincide with disruptive technological change and consistently focus on the new technology.
Tesla’s success did not come about by chance, but is the result of a clever corporate strategy. A key element of this strategy is the independent development of a charging infrastructure, which enabled Tesla to solve the classic chicken-and-egg problem of electric mobility. While established car manufacturers wanted to leave the development of the charging network to energy suppliers, Tesla pursued an integrated approach and created its own network of fast-charging stations in its target markets at an early stage. Breaking down this silo mentality reduced key market entry barriers and contributed significantly to the acceptance of electric vehicles.
Tesla’s software expertise was also completely underestimated at first. Key software components, especially for the powertrain, driver assistance systems, and the human-machine interface, are developed in-house at Tesla and are not sourced from suppliers in the form of prefabricated control units and software packages, as was previously common practice among traditional car manufacturers.
This in-house software development is supported by an electronic architecture (E/E architecture) based on a few powerful central computers instead of a large number of decentralized, function-specific control units. Based on this architecture, Tesla is able to regularly update vehicle software over-the-air (OTA).
Tesla’s impacct on the automotive industry is far-reaching. The company’s success has acted as a catalyst for a global wave of start-ups in the field of electromobility. Established car manufacturers are also responding by gradually converting existing traditional brands to electric drives or founding independent electric brands. This dynamic is particularly pronounced in China, where a large number of new manufacturers and brands have emerged within a short period of time and competition for market share is correspondingly intense.
With all this success for Tesla and the hype surrounding Elon Musk, the question naturally arises: Is Elon Musk infallible? Does he succeed at everything he does? Clearly not.
Tesla’s model policy in particular has shown significant weaknesses in recent years:
- Tesla’s commercial success is currently based exclusively on the Model Y and Model 3 vehicles.
- The newly developed Cybertruck is not at all to the taste of US customers and is selling very poorly.
- The Semi tractor unit is still not available in relevant quantities because of production problems with the new 4680 cells.
- Models S and X are technologically outdated and are being discontinued.
The use of camera-based environment detection alone in automated driving poses significant safety risks, as it reaches its limits in poor visibility conditions due to the nature of the system. This approach is particularly risky from a technological and regulatory perspective in view of the strategic realignment towards autonomous robotaxi services.
Elon Musk’s increasingly polarizing public persona is also likely to deter some customers.
We can only speculate about Tesla’s future. The company is undergoing a strategic transformation, which means that traditional volume and unit sales targets in the automotive business are increasingly taking a back seat. Tesla lost its title as the largest BEV manufacturer in terms of unit sales to BYD in 2025.
Long-term success depends primarily on whether the new products and services for autonomous systems that are still to be developed—such as robo-taxis and service robots—can hold their own against the competition in the new business areas:
- It will be exciting to see whether Elon Musk’s purely video-based approach to autonomous driving will achieve a breakthrough that many experts currently consider technically unfeasible.
- But as Nelson Mandela once said, “It always seems impossible until someone does it.”
Regardless of Tesla’s future development, it can already be said today that Elon Musk has made his mark on economic history as the entrepreneur who has given the global automotive industry a decisive impetus toward more sustainable and, in the long term, lower–carbon mobility.
The corporate history of Tesla
Exactly 20 years after Tesla was founded, two headlines caught the attention of the automotive world:
- In the first quarter of 2023, a historic turning point was reached in the automotive market: for the first time, an electric vehicle, the Tesla Model Y, took first place in global sales statistics.
- In the second quarter of 2023, Ford and GM announced their intention to use the Tesla charging network in the US in the future. Numerous other manufacturers followed suit, including Audi, BMW, Volvo, Hyundai, Mercedes-Benz, and Porsche.
Both events are significant milestones in the still young history of Tesla, which was founded in 2003 by Martin Eberhard and Marc Tarpenning in San Carlos, California’s Silicon Valley.
In one of the first financing rounds in 2004, Elon Musk, who had previously raised $180 million through the sale of Paypal, also took a stake in the start-up. He gradually took control of the company, and both Tesla founders left in 2008.
Fig. 1 – Tesla Roadster, built on the basis of the Lotus Elise
(Mit freundlicher Genehmigung/Courtesy of Wikimedia Common Sense unter GNU Free Documentation License, Version 1.2 or later)
Fig. 2 – Panasonic cylindrical cell 18650
(Mit freundlicher Genehmigung/Courtesy of www.akkushop.de [Homepage])
For its first production model, the Tesla Roadster, the development team drew on an existing vehicle. The Lotus Elise served as the basis, with its conventional combustion engine replaced by a specially developed electric powertrain (Fig. 1). Vehicle production was outsourced to the Lotus plant in England, where small series were manufactured.
The Tesla Roadster was launched in 2008; a total of 2,450 vehicles of this type were sold. Despite the comparatively small number of units, Tesla was able to gain important practical experience in real-world driving with this model, particularly in the areas of electric motors, power electronics, and battery systems.
The Roadster’s battery system was based on 18650 lithium-ion round cells manufactured by Panasonic. Cells of this format are still produced in large quantities today and are used in consumer goods such as laptops (Fig. 2). The designation 18650 describes the geometric dimensions of the cell, which has a diameter of 18 mm and a length of 65 mm.
A total of 6,831 individual cells of this type were installed in the Tesla Roadster’s battery system, which were connected to form a powerful battery storage unit with an energy density that was exceptional for its time.
Fig. 3 – Tesla Model S
(Mit freundlicher Genehmigung/Courtesy of Tesla, Inc. [Homepage])
Fig. 4 – Tesla Ladestation
(Mit freundlicher Genehmigung/Courtesy of Tesla, Inc. [Homepage])
The first vehicle developed entirely by Tesla itself, the Model S, was unveiled to the public in 2012 (Fig. 3). The luxury sedan, which is still in production today, represented a technological breakthrough in several respects, the significance of which for the further development of automotive engineering can hardly be overestimated.
- With a range of around 500 km, which was exceptional for the time, the Model S was consistently designed for use on long distances and highways, thus differing fundamentally from early electric vehicles, which were primarily designed for short-distance urban traffic. In addition, the Model S had the capability for DC fast charging from an early stage, making it ready for use with high-performance charging infrastructure.
- The vehicle’s electrical and electronic architecture also represented a break with established concepts: Tesla opted for a highly centralized, software-driven E/E architecture that enabled continuous functional improvements. In this context, the Model S was one of the first production vehicles that could be comprehensively updated over-the-air (OTA), allowing new features, performance adjustments, and security updates to be installed without a visit to the workshop.
For series production, Tesla acquired a production plant in Fremont, California, previously used by GM and Toyota. The site is located in close proximity to the original founding location of San Carlos on the opposite side of San Francisco Bay and enabled Tesla to set up its own large-scale vehicle production facility.
The premium SUV Model X was introduced in 2015 and was largely based on the drive and battery architecture of the Model S. However, the market launch of the Model X presented Tesla with considerable challenges. In particular, the rear gull-wing doors proved to be extremely complex to manufacture and led to massive production delays and very low production volumes in the start-up phase. These problems placed a considerable strain on the company’s financial situation and at times put Tesla in a position that threatened its very existence.
Fig. 5 – Tesla Model 3
(Mit freundlicher Genehmigung/Courtesy of Pixabay [tesla-5937063__340)
Fig. 6 – Tesla Model Y
(Mit freundlicher Genehmigung/Courtesy of Tesla, Inc. [Homepage])
Tesla’s first volume model, the Model 3, was launched in 2018 (Fig. 5). The ramp-up of series production was marked by considerable organizational and technical challenges and was described by Elon Musk himself as “production hell.” This phase was characterized in particular by problems with automation, supply chain coordination, and quality stabilization. However, as production matured, Tesla succeeded in stabilizing its manufacturing processes and realizing economies of scale.
The mid-size SUV Model Y followed in 2020 (Fig. 6) and is based technologically in large part on the platform, drive technology, and electronic architecture of the Model 3. This high degree of parts and platform similarity enabled a significantly faster and more efficient production start-up than with the Model 3 and contributed significantly to improving the cost structure.
Both models were initially produced at the main plant in Fremont, California. To significantly increase production capacity and reduce logistical complexity and dependencies, Tesla subsequently began building a global production network of so-called Gigafactories in strategically important sales markets. This approach allows for greater regional value creation, shortens transport routes, and reduces currency and trade risks.
In November 2019, the Shanghai plant began production of the Model 3 and Model Y and quickly became one of the company’s most productive locations. The Model Y began production in March 2020 at the Austin, Texas, plant and in March 2022 at the Brandenburg plant near Berlin.
With the successful ramp-up of volume models and global capacity expansion, Tesla reached the limits of its previous growth in the early 2020s. Competition in the BEV segment intensified significantly, both from start-ups and established automakers.
In addition, significant shortcomings in the model strategy became apparent: a long-announced, low-cost entry-level model failed to materialize, and the only newly developed vehicle in the passenger car segment, the Cybertruck, is considered a complete failure due to its polarizing design and high price.
Accordingly, Tesla has been in a phase of stagnation since 2023:
- Sales figures have stagnated at 1.8 million vehicles since 2023, and in 2025 they even fell to 1.63 million units.
- Tesla had to relinquish its title as the world’s largest BEV manufacturer by volume to its Chinese competitor BYD in 2025.
Perception of Tesla over Time
The change in public and industrial perception of Tesla over time is remarkable. This development shows parallels to other technology-driven companies, especially Amazon, whose strategic importance only became fully apparent after some time.
In the case of Amazon, the company was primarily perceived as an online bookseller in its early stages. Later, the assessment followed that Amazon sold a wide range of products but was not permanently profitable. It was only with the establishment and spin-off of the cloud division Amazon Web Services (AWS) that it became clear that Amazon was no longer purely a retail group, but a highly integrated IT company with its own technology platform and associated logistics infrastructure. This reassessment was accompanied by a significant increase in profitability, enterprise value, and reputation.
A comparable shift in perception can also be observed at Tesla. In the early stages, the Tesla Roadster was often reduced to merely replacing the combustion engine with an electric drive. Even after the introduction of the Model S, Tesla was credited with a remarkable technical achievement, but at the same time, attention was drawn to its continuing losses. It was only with the ramp-up of volume production of the Model 3, the commissioning of additional plants in the US and China, and the achievement of positive quarterly results for the first time that perceptions changed fundamentally. Tesla was increasingly perceived not as a niche supplier, but as a serious industrial player.
A decisive “aha moment” within the automotive industry came in 2020, when engineering teams at Mazda in Japan dismantled a Tesla Model 3 and analyzed the central electronic control and computing units (embedded control units, ECUs) in particular. It became clear that Tesla
- develops the central ECU for telematics and assistance systems, including AI accelerators and associated software, in-house,
- requires significantly fewer control units per vehicle than traditional OEMs,
- and that established manufacturers such as Mazda did not have the necessary resources or the relevant software and semiconductor expertise at that time to develop a comparably highly integrated ECU on their own.
These findings contributed significantly to Tesla no longer being classified primarily as an automobile manufacturer, but rather as a technology and software-driven company. Similar to the case of Amazon, it became clear that behind the visible end product lies a business model whose actual value creation lies in digital and systemic core competencies.
The corporate strategy of Tesla
What is the reason why Elon Musk succeeded in building an extraordinarily successful automotive company within a relatively short period of time? At the time Tesla was founded, the automotive industry—especially in the US—was considered a classic old economy sector characterized by high capital intensity, long development cycles, and strong barriers to market entry. Successful start-ups in this sector were correspondingly rare, especially when compared to the start-up landscape in Silicon Valley, which was heavily dominated by software and internet start-ups.
Tesla’s success is not limited to individual technological breakthroughs, but is the result of a consistently implemented overall strategy. Tesla used the transition to electric mobility as a disruptive technological break to deliberately circumvent established structures and business models in the automotive industry. Through an early first-mover position, the systematic development of charging infrastructure, and strong vertical integration, the company was able to generate network economies and overcome key market entry barriers at an early stage.
The following points summarize the key elements of this successful strategy:
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Focus on the electric powertrain:
In the initial phase, Tesla concentrated exclusively on replacing the conventional combustion engine powertrain with an electric drive. To this end, an existing vehicle was used and adapted accordingly (Tesla Roadster, Fig. 1), thereby reducing development costs and market entry risks. -
Use of standardized battery cells:
The high-voltage battery was constructed from widely used industrial lithium-ion round cells of the 18650 type (Fig. 2). The focus was on developing a powerful concept for connecting individual cells to modules and complete battery systems. -
Securing cell supply:
Through close cooperation with cell manufacturer Panasonic and later by setting up its own cell factories, Tesla ensured that the availability of battery cells did not become a limiting factor for production growth. -
Market entry via the premium segment:
The first vehicle developed entirely in-house was deliberately positioned in the premium segment (Tesla Model S, Fig. 3). This approach enabled higher margins and followed the principle that larger and higher-priced vehicles are more economically advantageous in the early stages of a new technology (“large cars, large profit”). -
Establishing its own charging infrastructure:
Tesla decided early on to establish its own charging infrastructure network instead of leaving this task to external players. This actively solved the central chicken-and-egg problem of electric mobility—a lack of charging infrastructure combined with low vehicle penetration. From the outset, Tesla focused on powerful DC fast charging instead of slow AC charging. -
Acceptance of initial losses:
In the early years of the company, short-term profitability was deliberately sacrificed. Profits were only to be achieved through scaling via volume models, in particular with the Model 3 and Model Y. -
Direct sales and reduced marketing:
Tesla largely dispensed with traditional dealer networks and cost-intensive marketing campaigns. Sales were primarily conducted online via the company’s own website, while social media platforms played a central role in brand communication. -
In-house software development and OTA capability:
A key component of the strategy was the in-house development of vehicle software. In combination with an OTA-capable E/E architecture, this enabled continuous bug fixes, functional improvements, and enhancements to the vehicles throughout their entire life cycle.
Tesla’s successful strategy can only be replicated to a limited extent under current market conditions, but individual elements are still being adopted by competitors:
- The concept of entering the market with high-priced battery electric vehicles with high margins is being copied by many BEV start-ups.
- Tesla’s infrastructure approach is also a model. Companies such as Daimler Truck, together with partners in Europe, are investing specifically in the development of a megawatt charging system (MCS) for heavy-duty electric trucks.
Tesla's software expertise
One of Tesla’s key strengths, which has long been underestimated, lies in its underlying electrical and electronic vehicle architecture (E/E architecture), which for the first time makes it possible to design the automobile as a software-defined system.
- While traditional car manufacturers use historically developed, highly distributed architectures with numerous function-specific control units, Tesla has pursued a highly centralized approach since its early vehicle generations.
- A small number of powerful central computers take over a large number of vehicle functions, most of which are implemented and controlled by software. This architecture reduces system complexity, simplifies functional integration, and forms the technical prerequisite for the continuous further development of vehicles via software.
An essential part of this approach is the in-house development of vehicle software. Central software components – such as those for the powertrain, energy management, driver assistance systems, and the human-machine interface – are developed in-house at Tesla and are not sourced from suppliers as integrated hardware and software packages, as is common with traditional OEMs.
This allows Tesla to retain complete control over functional logic, system integration, and further development, avoiding the dependence on external control unit and software suppliers that is common in classic architectures. This vertical integration of software development represents a fundamental difference from established OEM practice.
Closely linked to this is Tesla’s implementation of over-the-air updates (OTA). While many traditional car manufacturers are still working on OTA capability, and software updates are often still tied to visits to the repair shop, Tesla has been relying on regular wireless updates directly to the customer for years. This approach is more in line with the update paradigm of modern smartphones than with the classic understanding of vehicles and represents a significant efficiency and innovation advantage.
Tesla also develops essential computing hardware in-house. In particular, the processors used for driver assistance and automated driving functions are designed in-house and specifically tailored to the company’s own algorithms. The physical production of the chips is carried out by specialized semiconductor manufacturers, as is customary in the industry.
Impact on the automotive industry
With Tesla, Elon Musk has not only had a lasting impact on established car manufacturers, but has also triggered a global start-up boom in the field of electric mobility. In an industry that has long been considered a classic old economy industry with high barriers to entry, a dynamic start-up ecosystem has emerged for the first time in the field of battery electric vehicles.
The successful example of Tesla has motivated numerous entrepreneurs around the world to found their own electric vehicle start-ups. This development is particularly pronounced in China, but is also increasingly evident in countries without a strong automotive tradition, such as Vietnam and Saudi Arabia.
One notable example is the Chinese manufacturer XPeng. Its founder, He Xiaopeng, was one of the early Tesla customers in China and imported a Tesla Model S at an early stage. He was so impressed by the vehicle that he decided to enter the automotive industry himself.
The biographical parallels between Elon Musk and He Xiaopeng are also noteworthy. Neither of them came from the automotive industry, but rather from the technology and internet sector. Musk achieved his first entrepreneurial success with PayPal, while He Xiaopeng was co-founder of the IT company UCWeb, which was later acquired by Alibaba. In both cases, their entry into the automotive industry was preceded by extensive experience in building scalable, software-driven platform companies.
Tesla’s influence on the automotive industry can also be seen in the extent to which other manufacturers are modeling their design, technology, and product conception on the Tesla Model Y. As the world’s best-selling battery electric vehicle, the Model Y has established a benchmark for electric mid-size SUVs. Numerous manufacturers are adopting key features such as a minimalist design language, a highly software-centric vehicle architecture, and the comprehensive integration of digital operating concepts and over-the-air updates.
A particularly striking example of this was seen when Xiaomi entered the market. While Xiaomi‘s first vehicle model was conceptually based on a Porsche, the Tesla Model Y was explicitly used as a reference in the development of the later SUV model. This decision illustrates that Tesla is now perceived as the benchmark in a segment traditionally dominated by established premium and performance manufacturers.
Is Elon Musk infallible?
In Tesla’s corporate history, Elon Musk has already had to overcome numerous technological and financial challenges, such as the difficult production ramp-up of the Model 3 and recurring liquidity bottlenecks in the early stages of the company. Tesla is not currently in such a crisis situation. The company is operating profitably and is the only pure BEV manufacturer to date that is successful in all three major global markets – North America, Europe, and China.
However, there are clear signs that Tesla’s days of rapid growth are over:
- Sales figures have stagnated at 1.8 million vehicles since 2023, and in 2025 they even fell to 1.63 million units.
- Since 2025, Tesla is no longer the world’s largest BEV manufacturer.
The current situation at Tesla has both external and internal causes.
One of the main external causes is increasing competition in the BEV segment. In Europe, VW has now taken over Tesla’s leading role, while in China, the company has been overtaken by BYD. Only in its home market of North America is Tesla still the undisputed BEV market leader.
The first internal cause to mention is Tesla’s model policy:
- The company’s economic success is largely based on its volume model, the Model Y, while a clearly positioned entry-level model is still lacking.
- The Cybertruck is a failure, with sales figures in the US falling well short of expectations. Marketing outside the North American market is virtually impossible.
- Despite early announcements, the Tesla Semi truck is still not available in relevant quantities.
- The premium Model S and Model X vehicles are technologically and conceptually outdated, and production is to be discontinued.
The weaknesses of Tesla’s model policy are particularly evident in the example of the Cybertruck. Instead of seizing the historic opportunity to electrify and occupy North America’s most lucrative vehicle segment at an early stage, Tesla has launched a product that in no way meets market expectations.
The pickup truck market in the US has been dominated by the Ford F-Series for decades and is characterized by high volumes, above-average margins, and strong brand loyalty. At the same time, the segment is deeply rooted in culture and follows clear functional and aesthetic expectations. The Cybertruck fails to meet precisely these expectations: its highly polarizing design, practical limitations in everyday use, and high price make it largely unattractive to the core target group.
Internationally, too, the model remains without relevant prospects. In key overseas markets – particularly in Asia, Africa, Australia, and the Middle East – the pickup segment has been dominated for decades by the Toyota Hilux, which is established there as a robust, reliable, and versatile work vehicle. The Cybertruck is neither tailored to these application profiles nor suitable in terms of regulations and infrastructure to achieve significant volumes in these markets.
This is all the more significant given that the battery-electric pickup segment is virtually unoccupied to date – apart from niche providers such as Rivian and a few other projects such as Slate, which have not yet achieved any relevant market penetration.
Tesla has another problem with its Full Self Driving (FSD) driver assistance system. As it is currently an SAE Level 2 automation assistance system, the driver remains fully responsible for monitoring and liability.
Technologically, Tesla’s approach differs significantly from that of many of its competitors. Tesla relies solely on camera-based environment detection for Autopilot and FSD and does not use either lidar or radar. Radar has been gradually removed from vehicle hardware since 2021; remaining radar sensors are used only in the interior for passenger and safety monitoring, depending on the model, but not for perceiving the traffic environment.
For Elon Musk, autonomous driving is not just a technical issue, but a central component of Tesla’s new strategic direction, which aims to transform Tesla from a vehicle manufacturer to a provider of integrated mobility and AI systems.
The critical issue here is that Tesla is basing this vision on the same purely camera-based environment detection that Tesla also uses for Autopilot/FSD. The repeatedly documented malfunctions of FSD, such as unexpected braking maneuvers or misinterpretations of complex traffic situations, illustrate the current limitations of this purely vision-based approach in real-world traffic, especially in poor visibility or weather conditions.
Tesla stands alone with its single-sensor approach. All competitors pursue a multi-sensor approach with redundant sensor fusion from cameras, radar, and lidar to increase robustness and reliability.
This includes Waymo in particular, which has the most extensive driving experience to date, with over 160M kilometers driven autonomously on public roads worldwide. The company uses a combination of cameras, radar, and lidar and already operates its commercial robotaxi service in five US cities. This makes Waymo the technological pioneer for highly automated driving.
Zoox (Amazon) and Baidu Apollo Go, which operates autonomous driving services in numerous major Chinese cities, also rely on redundant sensor systems. With its “true redundancy” concept, Mobileye explicitly pursues separate perception paths: a camera-based system is backed up in parallel by independent radar and lidar systems.
The production of the new 4680 battery cells, with which the manufacturer wanted to achieve a technological leap in terms of cost, energy density, and manufacturing speed, continues to cause difficulties:
- The cells rely on a so-called dry electrode process, which is intended to eliminate the need for energy-intensive solvents and long drying times, as well as a “tabless” design that eliminates the classic current collector tabs in order to reduce internal resistance and heat generation.
- In practice, however, the industrial scaling of these processes proved to be much more difficult than planned: fluctuating quality, lower yields, and slower production rates initially prevented the hoped-for cost advantages from materializing.
These delays are having a direct impact on several vehicle programs, particularly models with high energy requirements such as the Tesla Semi. The electric semi-truck is heavily dependent on the higher energy density and lower unit costs of the 4680 cells, which is why production targets have had to be repeatedly postponed.
The Future of Tesla
With the new strategic realignment announced in early 2026, Tesla is moving away from its role as a traditional car manufacturer. To drive forward the development of new business areas, Elon Musk announced an investment program of more than $ 20B for 2026, which is almost double the previous year’s figure:
- A large part of the investment will go toward building a robotaxi network, which is to be established in at least nine US cities starting in 2026, including Austin, Dallas, Houston, Phoenix, Miami, Orlando, Tampa, and Las Vegas.
- At the same time, Tesla is pushing ahead with the development of the humanoid robot “Optimus”. Initially, the systems will take over repetitive tasks in Tesla’s own factories before becoming available for external applications in the future. In the long term, Musk sees market potential here that could exceed that of the vehicle business.
In contrast to the early years after its founding in 2003, when Tesla was largely unchallenged by established competitors and was able to set the standards for battery electric vehicles, the company has faced intense competition in its new business areas from the outset.
This is particularly evident in the field of autonomous robotaxis: Waymo, Alphabet’s robotaxi subsidiary, already operates commercial services in several US cities such as San Francisco, Los Angeles, Phoenix, Austin, and Atlanta, and plans to expand its network to more than ten cities in the US in 2026, as well as targeting international locations such as London and Tokyo for the first time.
Competitors have also already positioned themselves in the field of humanoid robotics: in addition to start-ups such as Figure AI and longer-term research projects by established robotics specialists, several companies are working on bringing assistance robots for everyday and industrial applications to market, which makes the technological challenges and diversity of approaches even more apparent when compared to Tesla’s “Optimus.”
This starting point makes it clear that Tesla will have to hold its own in the coming years in an environment that is far more dynamic and competitive than it was in the early days of electric mobility.