A Tesla Model X in 2021.Getty Images

Tesla CEO Elon Musk said Wednesday that the company would begin phasing out its Model S and Model X electric vehicles this year and retool a California factory to produce humanoid robots instead.

The announcement signals an end of an era. The two vehicles - introduced in 2012 and 2015, respectively - helped to move electric cars from the consumer fringe into the mainstream. They also fueled Tesla`s rise from a startup into the world`s most valuable automaker.

Musk announced the phase-out on a call with investors and Wall Street analysts, saying it was part of his effort to overhaul Tesla`s operations to focus on robotaxis and humanoid robots.

"We expect to wind down S and X production next quarter and basically stop production," he said, adding that the company would continue to support the vehicles for as long as people have them.

"That is slightly sad, but it`s time to bring the S and X programs to an end, and it`s part of our overall shift to an autonomous future," he said.

Musk announced the change as Tesla released its financial results for the final three months of last year. The company topped analysts` expectations for earnings but showed signs of weakness as total revenue for last year was down 3% from its 2024 revenue.

Its share price was up about 2% in after-hours trading.

Tesla vehicles` sales have suffered overall in the past year, as customers reacted to Musk`s involvement in right-wing politics and as competitors from China and elsewhere have given global drivers more choices.

Musk said that Tesla would convert its factory in Fremont, California, from an auto plant into the manufacturing site for the planned Optimus line of robots. Those robots are not yet on the market.

The Model S arrived at a time when electric cars were a tiny niche in the vehicle market, with many industry analysts doubting whether there was enough demand to sustain an electric-only automaker. But the Model S soon topped owner satisfaction surveys and developed a loyal following. The Model X, a crossover SUV, followed a few years later and initially received poor reviews for reliability.

In 2023, Tesla cut prices for both the Model S and the Model X in an effort to generate more demand.