ChatGPT's parent isn't an immediate threat. The fact that it's planning on entering the market at all, however, underscores the idea that Tesla isn't going to be in this business all by itself.

Chinese EV makers, including BYD and XPENG, are racing Tesla to commercialize humanoid robots, betting that physical AI will become the next big market.

Tesla announced on January 28, 2026, that it will stop making the Model S and Model X and convert that production space at its Fremont, California, factory into a dedicated line for Optimus humanoid robots.

See the top humanoid robots built for factory work, including Tesla Optimus, Figure AI, Apptronik Apollo, Agility Digit, and more.

The stock market has spent most of the past two years rewarding companies tied to artificial intelligence. Nvidia (NASDAQ:NVDA) became the world’s most valuable business because it supplies the chips powering the AI revolution.

Nvidia and Tesla lead contrasting strategies in a global race for physical AI and humanoid robotics, addressing severe labor shortages across China and the US.

According to data from Mobility Sweden, bilstatistik.dk, ANFAC, OFV, and PFA, Tesla registrations rose 71% year-over-year to 858 vehicles in Sweden, 136% to 1,750 vehicles in Denmark, and 113% to 1,690 vehicles in Spain.

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The U.S. is making genuine progress in humanoid robots and defense drones; less convincingly in industrial robots and component manufacturing.

Medical experts, however, strongly disagree with Musk's claims.