Tesla Inc TSLA CEO Elon Musk said on Thursday that there will be at least one humanoid robot for every person in the world in the future and the EV company will have a significant share of that market.
What Happened: Optimus is a humanoid robot designed and manufactured by Tesla, among its several non-EV tech initiatives. While two are currently employed in the company’s Fremont factory, taking cells off the end of the production line and placing them in containers, several others are walking the company’s office in Palo Alto.
Following a major hardware revision by the end of this year or early next year, Tesla expects to commence limited production of the Optimus to work in its factories and test its capabilities, Musk said at Tesla’s annual shareholder meeting on Thursday.
Musk expects the ratio of humanoid robots to humans to be at least one-to-one in the future, meaning there will be at least 10 billion or more humanoid bots. Tesla will deliver a significant share of this, Musk said.
If Tesla had a 10% market share and sold each humanoid bot for $20,000, “Tesla would basically make a like a trillion dollars profit a year,” Musk said.
Musk expects to be able to sell Optimus at $10,000 or $20,000, at a lower price point than Tesla’s cheapest Model 3 sedan, once it reaches high-volume production. While multiple robot startups are aiming to create humanoid robots, it will be difficult to build an Optimus as a startup as they have neither the resources nor the production capability to manufacture them at scale, Musk said.
“Prototypes are easy compared to volume manufacturing,” Musk said while adding that without volume production, these robots will likely cost hundreds of thousands of dollars.
Tesla had to manufacture every part of Optimus from scratch as no supply chain delivers the motors and other parts required for a humanoid robot, Musk said while adding that the company is, however, ramping up the capabilities of Optimus to enable it to play the piano with the next generation and take voice commands in future.
The EV company CEO said that the company would deploy at least a thousand Optimus bots at its factories next year to do tasks. Musk had previously said that the company would potentially start external sales of Optimus by the end of 2025.
“While autonomous vehicle is a $5-$7 trillion market cap situation, Optimus is a $25 trillion market cap situation,” Musk, who is known to over-hype his company’s products, said. The CEO himself admitted on Thursday that he is “pathologically optimistic” but delivers in the end.
Why It Matters: Tesla introduced its humanoid bot in 2021 with the initial goal of handling unsafe, repetitive, or tedious tasks. However, Musk on Thursday said that the Optimus can also serve as a companion, serve as a babysitter for children, or do chores at factories.
"I think Optimus will be more valuable than everything else combined. Because if you've got a sentient humanoid robot that is able to navigate reality and do tasks at request, there is no meaningful limit to the size of the economy,” Musk said during Tesla’s first-quarter earnings call in April.
Price Action: Tesla shares were up 1.30% in premarket trading on Friday, after closing at $182.47 on Thursday, according to data from Benzinga Pro.
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