Just days after announcing the discontinuation of the Model S and Model X, Elon Musk clarified that this is just the warm-up act. For anyone who missed the news, the Model S and X production lines in Fremont are being sacrificed to build Optimus Gen 3.
While the third-gen Optimus robot will be built in Fremont, the next-generation version (Optimus 4) will be built in Austin at Giga Texas. What could this mean for the production lines at Fremont once Optimus shifted to Austin?
Looking Even Further
In a post on X, Elon addressed the decision to use the older Fremont factory for Optimus, which has required multiple retrofits and upgrades to support automation.
During the Earnings Call, Elon stated that Optimus (gen 3), which will occupy the former Model S and Model X space, will target a final annual capacity of 1 million units. However, the future line in Texas will have much higher volume, likely reaching up to 4 million units per year by the end of 2027.
Eventually, that same line is expected to scale to 10 million units per year, assuming all goes according to Tesla’s plan.
Optimus 4 will be built in Texas at much higher volume
— Elon Musk (@elonmusk) January 29, 2026
Gen 3 vs Gen 4
The roadmap for Optimus is beginning to take shape and appears to be split into two distinct phases.
In Phase 1, Fremont will produce Optimus Gen 3, utilizing the footprint from the Model S and X lines. This line will address the initial challenges of mass-producing Optimus, including the complex and entirely new supply chain required for a bespoke humanoid robot.
In Phase 2, Giga Texas will be home to the future, more widely available Optimus Gen 4. This line will have about three to four times the Fremont line's initial capacity and up to 10x its final capacity upon full expansion.
Texas is the New HQ of Autonomy
This decision essentially puts Giga Texas at the center of Tesla’s autonomous future. The factory in Austin will eventually go on to house most of Tesla’s AI-related infrastructure and production lines, whether that be the brains (Cortex 1 and 2), the wheels (Cybercab), or the bodies (Optimus Gen 4).
While Fremont remains a critical manufacturing hub for Tesla, close to its engineering and design studios, it is increasingly looking like a legacy facility that’s being used transiently to test and get new lines up and running, with the engineers nearby to solve problems.
Keep Iterating
Tesla hasn’t officially unveiled Optimus Gen 3, which is scheduled for this quarter, yet Elon is already plotting out the manufacturing plans for Gen 4. While we wait to see what Gen 3 can accomplish, Tesla will apply the initial field learnings to the future Gen 4 model, making it even better and easier to mass-produce.
