Tesla to invest $20 billion capital in push beyond human-driven cars

Tesla plans to more than double its capital expenditure to a record $20 billion this year. But much of it will not go toward its traditional business of selling electric vehicles to human drivers.

The company, which last year lost its global leadership in electric vehicle sales to China’s BYD. Instead redirecting investment toward untested business lines such as fully autonomous vehicles and humanoid robots, according to comments from executives during Wednesday’s earnings call.

Highlighting the shift, CEO Elon Musk said Tesla will end production of its Model X SUVs and Model S sedans and use that space in its California factory to manufacture its Optimus robots.

Separately, in a post on his social media platform X, Musk said the robots will be produced at the Gigafactory in Texas at an even higher volume. “This is going to be a very big capex year,” he said. “We are making big investments for an epic future.”

Most of the record investment will go toward production lines for the Cybercab. A fully autonomous vehicle with no steering wheel or pedals. The promised Tesla semi-truck, Optimus robots, and battery and lithium production plants, said CFO Vaibhav Taneja.

Although the majority of Tesla’s sales still come from human-driven electric vehicles, its valuation is higher than that of any other automaker. Bringing it closer to major tech firms. Investors’ confidence that Musk will fulfill his audacious plans to provide robotaxis and humanoid robots supported by the company’s investment in artificial intelligence is a major factor in that valuation.