The Final Run

As Elon Musk kills the cars that built his empire, one specific number-2.7 percent-explains the massive gamble on robots.

[Speaker 1]: It happened exactly one week ago, on February 17th. In Austin, Texas, a vehicle rolled off the assembly line that looked like nothing else on the road-mostly because it was missing the one thing that defines a car. It didn’t have a steering wheel. [Speaker 2]: And it didn’t have pedals, either. That was the first production "Cybercab." But while everyone was staring at what Tesla is starting to build, they missed what Tesla decided to stop building. [Speaker 1]: Right. Today, we’re looking at why Tesla just killed the cars that made it famous to build a robot that isn't actually legal to drive yet. [Speaker 2]: And to understand why they’re doing this, you have to keep one specific number in your head: 2.7%. [Speaker 1]: It’s Tuesday, February 24, 2026, and you’re listening to The Angle. [Speaker 1]: So, if you’ve been casually watching the news, you probably saw the headlines from the earnings call back in January. But as of today, those headlines are reality. The era of the "original" Tesla is officially over. [Speaker 2]: It is. Elon Musk confirmed it explicitly. The Model S and the Model X-the luxury sedan and the SUV that basically created the modern EV market-are getting what he called an "Honorable Discharge." [Speaker 1]: Which is a polite way of saying they’re being cancelled. [Speaker 2]: Effectively, yes. Final production runs are scheduled for Q2 of this year. But the bigger shock wasn't the old cars dying. It was the new car that never arrived. The twenty-five thousand dollar "Model 2" that everyone was waiting for? That is officially dead. [Speaker 1]: And that’s the pivot point. Because for years, the story of Tesla was that they were a car manufacturer trying to get massive scale. You start with the expensive sports car, you move to the luxury sedan, and eventually, you make the cheap car for everyone. That was the master plan. [Speaker 2]: Exactly. And today, February 24th, is the day we can say they’ve abandoned that plan. They aren't trying to be the biggest car manufacturer anymore. They are pivoting the entire company to become what Musk calls a "Physical AI" monopoly. [Speaker 1]: Meaning, the hardware-the actual car-is just a container for the software. [Speaker 2]: Right. And to make space for that software, they are physically gutting the company’s history. The factory space in Fremont that used to build the Model S and X? It’s not staying empty. They’re converting it to build Optimus humanoid robots. [Speaker 1]: That is a massive gamble. You’re trading a product that definitely works and definitely sells for a robot that, up until recently, was just a guy in a spandex suit dancing on stage. [Speaker 2]: Well, the robot is real now, but the financial risk is just as high. And the way they are trying to pull this off comes down to a manufacturing overhaul that sounds more like a toy store than a car factory. [Speaker 1]: Coming up: Why Elon Musk thinks building cars the normal way is a waste of time, and the "Lego set" strategy they’re betting the company on. [Speaker 2]: This is where the mechanics get really interesting. If you look at the argument from inside Tesla, they aren't killing the Model S and X because they hate them. They’re killing them because the old way of making cars is too slow and too expensive for the AI future they want. [Speaker 1]: Because normally, a car travels down a long line, right? You stamp the metal, paint…