$TSLA · Solving The Money Problem · 2026-11-01

Earlier in the week, Tesla announced that their first production-quality Optimus robot was coming off the high-volume line in Fremont , where they stopped making the Model S and Model X , two cars I really like.

This line is designed to produce one million robots a year, or 20,000 robots a week. Elon said it will take at least a year to reach this stage of production, with deliveries to the first customers expected in 2027.

Optimus is roughly 1 to 2 years behind Elon's original schedule.

If Tesla could produce one million robots a year, that would be 20 times the world's total supply.

This is why Tesla is creating the Optimus Robot Academy. Maybe there will be thousands of robots there, much like a play school, that will learn and train by interacting with real objects.

Tesla's first Optimus production line has set a target of producing one million robots a year , which would surpass current global production; Their next-generation production line will have a capacity several times greater, i.e. 10 million or more.

The capacity of the next generation will increase several times, to 100 million or more. Musk himself has said he will build more than 1 billion humanoid robots.

I do n't even want to think about competing with Tesla on this.

I'm pretty confident that Elon will eventually achieve his supply side goals and possibly surpass China's production. He has indicated in his past comments that the first use will be in production at Tesla factories.

Initially , the purpose of using Optimus humanoid robots to perform monotonous, repetitive, and dangerous tasks in Tesla's own factories was to teach, train, and expand their skills.

Once these start working well in Tesla's factory, they will have plenty of customers for other similar situations, production lines, factories, manufacturing, warehouses, and logistics.

It's a bit like Starship, suddenly having created such a huge up-and-coming capacity that it has to create a new market to meet its own supply needs. Maybe he will focus on household chores initially , or maybe on the construction industry, or maybe he will target the many industries that are waiting for cheap humanoid robots.

But the fact that he's kept it a mystery beyond just saying "I'll use these in Tesla or SpaceX/Tesla factories" is the most mysterious part of it all to me and I'm really surprised.

Let's break it down a bit, because you know he's going to take Model S and Model Y production rates to all-time highs when the robots start working, but he also wants to build one Starship every day.

The market is now in such a state that he can produce 100,000 to 500,000 robots next year. Of these, 100,000 robots cost $3 billion, and if you compare that to other capital expenditures , I think he can handle that too.

For example, if he can reach 1 million units next year, the revenue from Optimus at 1.6 million will be greater than Tesla's revenue.

To be clear, I do n't mean to be pessimistic here, but I think the chances of Optimus reaching an annual production rate of one million next year are close to zero. Not absolutely zero, but remember, a whole new supply chain has to be created.

This is a completely new technology, everything is being designed and engineered basically from scratch.

Still, it's only a matter of time before Tesla rolls out a million humanoid robots a year , but I wanted to make this overly ambitious hypothetical somewhat realistic.

Next year you will see a status quo in hardware, where the same Optimus model will be produced for a few years, but the software will continue to improve until 2028 and beyond.

So, if you buy these robots now in advance, their value will actually increase, just like we saw with GPUs, right?

SpaceX has about 20,000 human employees, while Tesla has more than 130,000 human employees. At this production rate, the 1 to 2 years Elon Musk is talking about for Optimus, it will spread outward far more than their internal needs or demands , even if they go fully recursive self-improvement.

I don't think Tesla and SpaceX combined have the internal capacity to take on this entire output , if he sticks to his numbers.

This is a huge advantage for Tesla, SpaceX, and Elon Musk. Being my own first customer, and I include SpaceX, although technically Tesla and SpaceX are separate companies, they complement each other very well.

However, if you are inspired to use the less capable, less skilled, and less intelligent Optimus humanoid robots at the initial level in your own business , you can learn from them and increase their capabilities , so that after meeting your own needs, you can get a lot of commercial customers for similar tasks.

This is very cool and a huge advantage for Tesla that no other company in the effort to build humanoid robots has.

But if you're Tesla and one of your products is a humanoid robot, and you make a lot of things with a lot of steps that are tedious, repetitive, or dangerous , then man, that's perfect.

Where Elon might decide to compete with Sam and his automated data center, "To all shareholders, Tesla and SpaceX need to merge, because SpaceX needs Tesla's Optimus robot to build its future ground-based data center." So, merge them.