Tesla’s 2025 Annual Shareholder Meeting (Transcript)

You are the beating heart of Tesla, and we cannot continue to deliver without you.

To the management team who never get a shout out, thank you for your huge effort. To our shareholders, all of you in the room and on the webcast globally, once again, thank you for your support. Please know that we are listening to you and are here to represent your interests. You are the owners of the company, and your voices, your perspectives, and your input are critical to what we do here at Tesla each and every day.

My fellow directors and I serve you as your fiduciaries and oversee Tesla’s mission, purpose, and strategy, and these responsibilities are in our minds every day. I would also like to take this opportunity to thank my fellow directors for their diligence, their dedication, and their tireless efforts.

Changing the world for the better is always accompanied by difficulties. And what I can say is that you can’t do it by checking the boxes and just reviewing PowerPoint presentations. Thank you for rolling up your sleeves, each and every one of our directors, the hard work that you do, lending your unique talents and delivering to our shareholders. Thank you.

Our accomplishments have been hard earned, and these last several years have not been without their challenges. We still have much to accomplish, and I believe that we have the right team, the right technologies, the right physical infrastructure to create a world that we’ve only just begun to imagine. The future is bright. Thank you. Now I’m going to hand it back to Brandon.

Formal Meeting Proceedings

BRANDON EHRHART: Thank you very much. Thank you, Robyn. I will now call the meeting to order. It is three twenty five pm, and I declare that the polls are now open.

We have already received over the past few weeks voting proxies from our shareholders. However, if you wish to vote your shares now, you may do so on the online portal or with the ballot boxes you received at the front. Tesla has appointed Tony Carridio, a member of the Carridio Group, to serve as our Inspector of Elections.

In addition, Broadridge Financial Solutions has certified that starting on September seventeen, twenty twenty five, the proxy materials or notice of Internet availability of the materials were sent out or mailed to shareholders of record as of September fifteen, twenty twenty five. We have a majority of the outstanding shares represented at the meeting, so I declare that a quorum is present.

# Agenda Items

We now will proceed with the meeting. The items of the agenda are as follows. There are six Tesla proposals:

1. The election of our three Class III directors, Ira, Joe and Kathleen, to serve a term of three years until their successors are duly qualified.

2. To approve say on pay on a nonbinding advisory basis.

3. To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for fiscal year twenty twenty five.

4. To adopt amendments to our organizational documents to eliminate certain supermajority voting requirements.

5. To amend and restate the twenty nineteen equity incentive plan.

6. The twenty twenty five CEO performance plan to Elon Musk.

The Tesla Board has recommended that all our shareholders vote for each of the director nominees and for the Tesla proposals except for the one on supermajority voting where no recommendation has been made.

We also have eight shareholder proposals that are described in our proxy statement. I’d like to remind the shareholders that Tesla’s Board has prepared a statement of opposition on each of them, except for the one regarding xAI. Those statements are in our proxy. Now let’s go through the shareholder proposals.

Shareholder Proposals

# Proposal Seven: XAI Investment

BRANDON EHRHART: The first one is an advisory vote regarding Board authorization of investment in xAI. Our Board has not made a recommendation on this. The shareholder proposal is proposed by Mr. Stephen Hawk, who I believe is here to present the proposal. Mr. Hawk?

STEPHEN HAWK: Thank you so much. Good afternoon, ladies and gentlemen, fellow shareholders, Elon and esteemed Board members. Thank you for this historic opportunity. I am Stephen Hawk, shareholder since twenty twelve. It’s truly my honor to present shareholder proposal number seven.

The proposal is simple. I urge the board to exercise its discretion and authorize a strategic investment in xAI in some meaningful way sooner rather than later. This isn’t just capital. It’s about formalizing Tesla’s role as a leader in autonomous intelligence, turning AI into our new book, not just a new chapter.

Tesla has always been an AI company, revolutionizing transportation, energy and robotics through FSD and Optimus. But as we approach the singularity during this tsunami of AI outsourcing our brain to external providers, risks, misaligned goals, data vulnerabilities, and lost innovation.

xAI founded by Elon is different. It is maximally truth seeking, curiosity driven, and aligned with humanity’s best interests, like Tesla’s mission for sustainable abundance. xAI was seeded with Tesla talent enabling bidirectional flow for highest caliber staff attraction and retention. Integrating Grok models within our vast real world data would further supercharge FSD for safer vehicles and power Optimus to navigate complex worlds and to optimize energy grids. Think vertical integration of Tesla as a neural link of AI platforms, controlling the coming Optimus army with prudent stewardship.

Financially, it’s a no brainer. xAI‘s explosive growth could yield massive returns, strengthening our balance sheet amid EV pressures with Elon’s stewardship the best for separating AI safely. Conflicts are minimal. Board oversight ensures fairness. xAI needs Tesla more than vice versa. But together, we foster human happiness, consciousness, and meaning beyond work shifting purpose from labor to truth seeking in a world of abundance.

Shareholders, we can’t be spectators. Tesla must actively participate. Let’s not outsource our destiny, but rather own it and maintain power, control, and safety. I call on the board to formalize this investment relationship and on you to support it. Thank you to Elon, and special thanks to Tesla Glomer Mama, Alexander Mertz.

# Proposal Eight: Sustainability Metrics in Executive Compensation

BRANDON EHRHART: Thank you, Mr. Hawk. The second shareholder proposal is an advisory vote regarding adopting targets and reporting on certain sustainability metrics with our senior executive compensation plans. Our Board has recommended that our shareholders vote against this proposal as explained in our proxy. The shareholder proposal is proposed by Tulip Share Capital LLC, whose representative Mr. Antoine Rouge has prepared a prerecorded message.

VIDEO CLIP BEGINS:

ANTOINE ARGOUGES: Hello, shareholders. I am Antoine Argouges, CEO of the impact fund Tulipshare speaking in support of proposal eight. Our proposal asked Tesla’s board to take a simple but meaningful step, link a portion of the executive compensation to measurable sustainability performance.

Tesla’s success has always been built on bold, measurable goals, production target, market cap milestone and innovation. But as we enter a new era of scrutiny around climate, labor and governance issues, it’s time that part of those milestones also reflect how sustainable that success is achieved.

Proposal eight is not asking to replace all the financial goals. We’re asking to strengthen them. Imagine if one or two tranches of the future compensation were tied to tangible outcome such as reduction in carbon intensity per vehicle, verified improvement in worker safety or supply chain transparency. These are metrics that protect long term shareholder value, reduce legal and reputational risk and ensure Tesla’s leadership is rewarded not only for scale, but for sustainable impact.

Tesla’s mission is to accelerate the world’s transition, linking compensation to sustainability metrics, ensure that this mission lives at the very core of the leadership decision making. This is how Tesla can continue to lead not just in innovation, but also in responsibility. We urge shareholder to vote for this proposal and support the compensation framework that drives both performance and purpose. Thank you.

VIDEO CLIP ENDS:

# Proposal Nine: Labor Practices Audit

BRANDON EHRHART: Thank you, Mr. Argouges. As a reminder, the Board’s response is set forth in the proxy. Our third shareholder proposal is an advisory vote regarding an audit of certain labor practices. The Board has recommended against that, as set forth in our proxy. The shareholder proposal is proposed by the National Center for Public Policy Research, whose representative Stephane Padfield has prepared a prerecorded message.

VIDEO CLIP BEGINS:

STEFAN PADFIELD: My name is Stefan Padfield, and I am the Executive Director of the Free Enterprise Project. The Free Enterprise Project is part of the National Center for Public Policy Research, which is the proponent of Proposal nine requesting that Tesla conduct and report on a child labor audit.

Let me begin by emphasizing that we are strong supporters of free enterprise innovation and shareholder value. We recognize Tesla’s extraordinary contributions to the electric vehicle market. Our proposal is not anti Tesla. It is pro transparency and pro shareholder.

Proposal nine asks for something very simple and reasonable, a verified accounting of whether and to what extent child labor is implicated in Tesla’s supply chain. Tesla’s opposition statement relies on policies, but policies are not the same as proof.

VIDEO CLIP ENDS:

# Shareholder Proposals and Responses

Proposal Nine: Supply Chain Transparency and Child Labor

A zero tolerance policy is commendable, but without independent verification it is only a promise, not evidence. The U.S. Department of Labor continues to list cobalt mining in the Democratic Republic of Congo among the sectors with the worst forms of child labor. A 2023 white paper on the financial and material impacts of child labor, authored by HACE, identifies Tesla as a case study in the ongoing risks that cobalt and other mineral sourcing pose to automakers.

And while Tesla’s own 2024 impact report notes that the company invested more human and legal resources than ever before to combat forced and child labor, it provides no metrics showing whether those investments are working. Shareholders deserve data, not just assurances. We are asking Tesla to back its admirable words with verifiable results through a third party audit or a transparent report.

This is not just a moral question, it’s a governance and risk management issue. Reputational, legal, and operational risks can directly affect shareholder value. So too can the risk that enthusiasm for electric vehicles undermines proper accounting of the often hidden cost that child labor may be embedded deep in EV supply chains.

If Tesla is truly the industry leader it claims to be, it should also lead in transparency. We all know that proxy vote counts can be distorted by a plethora of conflicts of interest. Accordingly, we urge Tesla’s board to see this proposal not as an attack but as an opportunity to properly account for the costs and benefits of Tesla’s mission regardless of the final vote. If you have not done so already, please vote for proposal nine. Thank you.

UNIDENTIFIED SPEAKER: Thank you, Mr. Padfield. As a reminder, the Board’s response is set forth in the proxy.

Proposal Ten: Derivative Suit Ownership Threshold

UNIDENTIFIED SPEAKER: Our fourth shareholder proposal is a vote to amend the bylaws to repeal a derivative suit ownership threshold. Our Board has recommended against, as set forth in the proxy. The shareholder proposal is proposed by the Comptroller of the State of New York as the lead filer, whose representative, Thomas DiNapoli, has recorded a prerecorded message.

THOMAS DINAPOLI: This is Thomas DiNapoli, New York State Controller. As trustee of the New York State Common Retirement Fund, owner of more than 3.3 million shares, we urge shareholders of Tesla to vote for proposal ten to amend the bylaws to repeal the three percent derivative suit bylaws ownership threshold.

We filed a proposal along with New York City Controller Brad Lander to restore one of the most fundamental investor rights, the right of shareholders to hold directors and officers legally accountable when they breach their fiduciary duties. When Tesla asked investors last year to approve its move from Delaware to Texas, the Board assured us that shareholder protections were similar in both states.

Yet within months, Tesla’s board engaged in a bait and switch scheme and immediately turned its back on its investors by amending its bylaws to reduce shareholder rights as soon as Texas offered an opportunity to do so. The new bylaw allowed Tesla to block nearly every investor from bringing a derivative suit unless they hold three percent of the company’s stock, currently about $30 billion in Tesla shares.

That threshold leaves only Elon Musk and a handful of giant Wall Street funds with any legal standing to act on their own. It effectively makes the board immune from accountability. Tesla claims this rule is meant to discourage frivolous lawsuits, but courts already have tools to dismiss meritless cases. This bylaw doesn’t stop abuse. It stops proper oversight and it tells shareholders that the board no longer wants to be answerable to them.

Our proposal simply seeks to repeal that bylaw and restore accountability. It ensures that if directors violate their duties, all investors still have a path to protect the company’s long term value. Unfortunately, this attack on shareholder rights is part of a larger pattern at Tesla. We see a Board that lacks true independence.

The Board has allowed our CEO to divide his attention among multiple outside ventures and then offered a pay proposal that could hand him a trillion dollar windfall and even more unchecked power. These are not isolated issues. They all stem from the same problem, a board that refuses to act as an independent check on management.

Tesla has changed the world through innovation, but no company, no matter how visionary, can thrive without accountability. Strong governance protects investors and strengthens companies over time. I urge all shareholders to send a clear message that accountability, independence and respect for shareholders are essential to Tesla’s future success. Thank you for your time and consideration.

UNIDENTIFIED SPEAKER: Thank you, Mr. DiNapoli. The Board’s response is set forth in the proxy.

Proposal Eleven: Bylaw Amendment Ratification

UNIDENTIFIED SPEAKER: The fifth shareholder proposal is a vote to amend Article ten of the bylaws. The board has recommended that our shareholders vote against it as set forth in our proxy. This shareholder proposal is proposed by the treasurer of the state of Illinois and Trustee of the Bright Directions College and Savings Trust as the lead filer whose representative Michael Frerichs has prepared a prerecorded message.

MICHAEL FRERICHS: Fellow Tesla shareholders and members of the Board, my name is Michael Frerichs. I serve as Treasurer of the State of Illinois and as Trustee of the Illinois College Savings Programs. I’m here to present Proposal eleven, which asks Tesla to adopt a simple investor protection. If the Board chooses to impose more restrictive requirements for submitting shareholder proposals as newly permitted under Texas law, those changes must be ratified by a super majority of shareholders.

At its core, this proposal is about protecting shareholder rights. If the Board decides to limit our ability to submit proposals, this amendment ensures the shareholders have the final say. It helps to ensure that Tesla remains aligned with the will of its investors, plain and simple.

Now why is this important? Tesla is navigating a period of volatility, leadership transitions, intense competition and heightened scrutiny from regulators and customers. In times like these, strong governance and active shareholder input can be critical. They serve as competitive advantages that position Tesla to lead, not just react. This proposal seeks to implement a reasonable safeguard would reinforce accountability and build trust.

The Board itself has emphasized the importance of investor feedback. In the proxy statement, Chair Robin Denholm and Director Kathleen Wilson Thompson wrote, “We are in Texas because it provides a more predictable governance framework that allows us to hear from you, the people who know Tesla best.” If the Board actively seeks to hear from shareholders, it’s hard to reconcile that position with their opposition to this proposal.

To reiterate what’s at stake, Texas law now allows shareholder submission thresholds higher than SEC standards, requiring shareholders or groups to hold three percent of voting shares or $1 million in stock to submit a proposal. Compare that to current SEC rules, which allow a shareholder to have holdings as low as $2,000 to $25,000 depending on how long the shareholder has held the stock.

If the Board chooses to adopt the Texas thresholds, they risk silencing investors who could drive meaningful governance improvements as well as narrowing the pipeline of ideas. Note that this proposal does not limit the Board’s direction to evaluate governance options. It simply ensures that if the Board adopts the Texas shareholder submission thresholds, a super majority of shareholders must ratify that decision.

That’s fair. It’s reasonable and fully aligned with the Board’s stated commitment to its investors. Again, I encourage my fellow investors to vote Proposal eleven as a clear step towards protecting our rights as shareholders. Thank you.

UNIDENTIFIED SPEAKER: Thank you, Mr. Frerichs. As a reminder, the Board’s response is set forth in the proxy.

Proposal Four: Annual Director Elections

UNIDENTIFIED SPEAKER: The sixth shareholder proposal is an advisory vote to elect each director annually. Our board has recommended against, as set forth for the reasons in the proxy. This shareholder proposal is proposed by James McRitchie, who has prepared a prerecorded message.

JAMES MCRITCHIE: Thank you, shareholders. We’ve presented this proposal before, 2021 and 2024. It won a majority both times, even with board opposition. But Tesla requires a super majority of shares outstanding, so those majorities weren’t enough. Today we ask again, join the 90 percent of S&P 500 companies that elect all directors annually.

Declassification means accountability every year, not every three years. Most institutional investors support this reform. It’s the retail votes we need here today. A Delaware court recently found three major governance failures at Tesla. The Board wasn’t independent, the disclosures to shareholders on its pay plan were misleading, and the board failed to negotiate properly on our behalf. Declassifying the board is part of the cure. It ensures shareholders can hold directors accountable each year or nominate qualified replacements when needed.

Matt Mascardi of Free Float Media calls this one of the most important votes of the year because it could shift Tesla’s board from a friends and family plan to independent professionals with the skills necessary for Tesla’s next chapter. We’re also endorsed by Nell Minow, co-founder of ValueEdge Advisors, and ISS, one of the most respected proxy advisors.

John Chiveden’s related proposal, number thirteen, calls for simple majority voting. We’ll need that reform too for this proposal to succeed. Tesla’s Musk premium, once a source of strength, is fading, along with his global reputation. Remember, Tesla is his only publicly traded company. It’s the liquid piggy bank that fuels his other ventures.

Yes, Elon Musk is brilliant, but no company should depend on a single personality. Either he stays long enough to keep using your capital elsewhere, or he moves on when the tap runs dry. Either way, shareholders must prepare for Tesla’s future, a democratic, professional company led by a capable, independent board.

Let’s build Tesla to attract customers, employees, and investors who all contribute to its innovations. Vote for proposal number four, declassify the board. Vote for proposal number thirteen, eliminate supermajority requirements. Together, let’s restore accountability, independence and trust at Tesla. Vote now before the polls close. Your vote can make a real difference in Tesla’s future and your future as well. Thank you.

UNIDENTIFIED SPEAKER: Thank you, Mr. McRitchie. As a reminder, the Board’s response was contained in the proxy.

Proposal Thirteen: Democratic Majority Vote Standard

UNIDENTIFIED SPEAKER: Our seventh shareholder proposal is an advisory vote regarding a proposal that won 54 percent at last year’s meeting. Our Board has recommended against for the reasons set forth in the proxy. This shareholder proposal is proposed by John Chiveden, who is on the line to present this proposal. Mr. Chiveden?

JOHN CHIVEDEN: Hello. This is John Chiveden. Proposal thirteen. This proposal is about Tesla being governed by a democratic majority vote standard. This proposal thirteen is proud to be on the same topic as the Tesla proposal six.

SIROS requests that Tesla take the steps necessary so that each voting requirement in the Tesla charter and bylaws that calls for a greater than simple majority vote be replaced by a democratic requirement for a majority of the votes cast for and against such proposals or a simple majority vote standard.

It is important to vote for both proposal thirteen and proposal six, which are on the very same topic. In fact, it’s more important to vote for proposal six because proposal six is a binding proposal, and this proposal thirteen is an advisory proposal. It is important to vote for proposal thirteen because proposal thirteen is a backup proposal in case the Tesla proposal six does not get enough votes.

This proposal thirteen has one advantage over proposal six in that it requires less votes to be approved by shareholders than the Tesla proposal six since this proposal thirteen is an advisory proposal. But it’s still important to vote for both proposals. Adoption of proposal six will pave the way for annual election of each Tesla director sooner than this proposal thirteen.

Annual election of each Tesla director will tend to keep Tesla directors away from their current status as being lapdog enablers for Mr. Musk and Mr. Musk’s outrageous executive pay and Mr. Musk’s outrageous distractions from Tesla. Please vote yes for Tesla being governed by a Democratic majority vote standard proposal thirteen and vote for the Tesla proposal six on the same topic.

UNIDENTIFIED SPEAKER: Thank you, Mr. Chiveden. As a reminder, the Board’s response is set forth in the proxy.

Proposal Fourteen: Shareholder Approval for Bylaw Amendments

UNIDENTIFIED SPEAKER: Our eighth and final shareholder proposal is an advisory vote to seek shareholder approval before adopting certain bylaw amendments pursuant to Texas law. The Board has opposed it for the reasons set forth in the proxy. This shareholder proposal is proposed by Eric and Emily Johnson and Bruce Bryce Matherin as co-filers, whose representative Bruce Herbert from New Ground Social Investment has prepared a prerecorded message.

BRUCE HERBERT: Good afternoon. I’m Bruce Herbert of New Ground Social Investment in Seattle, and I stand to move proposal number fourteen, a simple request that Tesla hold a vote before adopting any bylaw that would restrict the ability to file a shareholder proposal.

Here’s why this matters. Texas recently passed a law that allows companies to set sky high barriers to shareholder participation. Instead of the SEC’s current one year ownership threshold of $25,000, these Texas rules would require owning $1 million of stock or three percent of the company, in Tesla’s case roughly $30 billion before one could file a proposal. And Tesla could enact this without a shareholder vote simply by issuing a notice.

This is not shareholder democracy. It’s silencing shareholders like nearly every one of us in this room, whether you are an individual, retiree or institution. The backers of such thresholds presume you must be ultra rich in order to have a good idea, which on its face is a baseless and undemocratic proposition.

The shareholder proposal process serves both Tesla and the capital markets. This is because stockholders frequently spot emerging risks long before they hit the headlines, whether in the form of labor relations, climate impacts or failures in governance. Shareholders provide an efficient early warning system that helps companies to stay ahead of the curve. We are a low cost, high value cornerstone that keeps companies and capital markets healthy.

In closing, corporate democracy is not a nuisance. It’s an important safeguard. It’s how shareholders ensure accountability and informed long value creation. The idea here is quite simple. Before limiting shareholder rights, put it to a shareholder vote. Therefore, to keep Tesla engaged, accountable and forward looking, please vote for proposal number fourteen. Thank you.

# Shareholder Meeting Results and Closing

UNIDENTIFIED SPEAKER: Thank you, Mr. Hebert. As a reminder, the Board’s response is set forth in the proxy. Please note now is your final opportunity submitting votes for them to be counted. I declare that the polls are now closed. Based on the proxies that we have received and the votes submitted at the meeting, I’d like to announce these results on a preliminary basis.

With respect to the shareholder proposals, items eight through fourteen, our shareholders have supported the recommendations on the Tesla Board on all of them other than Proposal twelve. With respect to proposal seven regarding xAI, while we have received more votes in favor than we did in against, there were a significant number of abstentions. Since this is an advisory vote, the board will examine the next steps in light of this level of shareholder support.

Now moving on to the Tesla proposals. First, on the proposal to adopt amendments to our organizational documents to eliminate certain supermajority voting requirements, our shareholders have not approved.

Second, on the say on pay advisory vote, our shareholders have approved. Third, on the ratification of the appointment of PricewaterhouseCoopers as our Tesla’s independent registered public accounting firm for the 2025 fiscal year, shareholders have approved. Fourth, on the election of our three Class III directors, Ira, Joe and Kathleen, our shareholders have reelected them. Fifth, on the amended and restated 2019 equity incentive plan our shareholders have approved. Sixth and finally, on the 2025 CEO Performance Award to our founder and CEO, Elon Musk, with over seventy five percent voting in favor.

Approved. I declare this meeting is now closed.

Elon Musk’s Remarks

ELON MUSK: Welcome. So what we’re going to… yeah. And those bots are just dancing. There are no wires. Those are actual robots. Thanks, guys.

First of all, I’d like to just give a heartfelt thanks to everyone who supported shareholder votes. I super appreciate it. Thank you, everyone. I’d like to thank the Tesla Board for their immense support. We have a fantastic Board, fantastic group of shareholders. Thank you all.

And what we’re about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book. And I’m going to talk about that. So this really is going to be quite the story, and Optimus is a fundamental part of that.

The Scale and Vision of Optimus

The sheer scale of Optimus… I mean, I’m going to say a bunch of things that probably I shouldn’t say, but that’s what keeps it interesting. I mean, have you watched any other Annual Shareholder Meeting? I mean, honestly, was like… I mean, if you need to go to sleep, sure. I mean, shareholder meetings are like snooze fest. I mean, ours are bangers. I mean, look at this. This is sick.

And we got, like, the cyberpunk nightclub here with real robots just standing there and milling around and dancing. And, you know, around our engineering headquarters in Palo Alto, the robots are just walking around the office twenty four seven with no one minding them. They’re just… and then they go charge themselves. And yeah.

So the scale of Optimus, like I said, that’s really going to be something else. I think it’s going to be the biggest product of all time by far. Yeah. So, like, bigger than cell phones, bigger than anything. I guess the way to think about it is that every human on earth is going to want to have their own personal R2-D2 C-3PO. So who wouldn’t?

But actually, Optimus will be even better than them. Like R2-D2, it’s kind of would beep at you, and it’s kind of hard to figure out what he’s got talking about. You need C-3PO to translate. But Optimus is going to be like everyone’s going to want one.

I think in terms of industry providing products and services, I think it’s probably, I don’t know, three to five robots in industry for every one that’s a personal robot. I think there could be tens of billions of Optimus robots out there.

Now obviously, it’s very important we pay close attention to safety here because we do want the Star Wars movie, not the Jim Cameron movie. I love Jim Cameron’s movies, but you know what I mean. So yes.

Production Plans and Future Impact

So we’re going to launch on the fastest production ramp of any product of any large complex manufactured product ever, starting with building a one million unit production line in Fremont. And that’s Line one. And then a ten million unit per year production line here on the… I don’t know where we’re going to put the one hundred million unit production line. Maybe on Mars, I don’t know.

But I think it’s going to literally get to one hundred million a year, maybe even a billion a year. And, you know, people often talk about, like, eliminating poverty, giving everyone amazing medical care. Well, there’s actually only one way to do that, and that’s with the Optimus robot.

With humanoid robots, you can actually give everyone amazing medical care. In terms of Optimus will be more precise. Optimus will ultimately be better than the best human surgeon with a level of precision that is beyond human. So I think that’s a pretty wild concept to say, okay, you… there’s always people always talked about eliminating poverty, but actually, Optimus will actually eliminate poverty. Optimus will actually give people incredible medical care.

So I mean and so you start getting, like, sort of some pretty wild sci-fi sort of scenarios where in some of these things I say will obviously be taken out of context and using snippets and, you know, sitting around, but whatever. I’m still going to say them.

You know, like, I think we may… we might may be able to give people a more… if somebody’s committed crime, a more humane form of containment of future crime, which is if you… you say, like, you now get a… you now get a free Optimus, and it’s just going to follow you around and stop you from doing crime. But other than that, you get to do anything. It’s just going to stop you from committing crime. That’s really it. You don’t have to put people in like prisons and stuff, I think.

It’s pretty wild to think of the various of all the possibilities, but I think it’s clearly the future. And, you know, my book recommendation for the maybe the best, mostly utopian sci-fi future are the Ian Banks books, the culture books. So if you’re curious, like, what do I think the future is probably like? I think it’s probably a bit like that. Or, you know, Asimov to some degree, but I think it’s… and Heinlein. But in Banks, if you’re like saying, what does Elon think the future probably will be like for AI and robots? It’s kind of Banksian.

Economic Transformation

So now and things do get kind of wild from an economic standpoint because at a certain point, with AI and robotics, you can actually increase the global economy by a factor of ten or maybe one hundred. There’s not like an obvious limit. So like Optimus is kind of like an infinite money glitch. And maybe there won’t even be money in the future. Money might be measured in terms of wattage, like how much power can you bring to bear from an electrical standpoint.

So I guess what I’m saying is hang on to your Tesla stock. So, yes, man, it’s pretty wild. You’re welcome.

Let’s see. I think we’ve got some slides to go through. I’m going to ad lib a lot of this stuff, but so the… you know, when we started Tesla, the goal was to accelerate the advent of sustainable energy, and that is that’s what we’ve done. I think Tesla has really led the way with electric vehicles, with battery packs, with a lot of solar, and many other companies have then followed our lead and done that.

And electric cars, which used to be nonexistent, are now prevalent. And the Model Y, for example, is the number one selling car of any kind on earth. Obviously, now with AI and robotics, we need to update our mission.

Updated Mission: Sustainable Abundance

And our mission, I think it’s a good… it’s a great mission, which is to achieve sustainable abundance, which is… it’s like because I often ask people like, what is the future that you want? What’s the best future you can imagine? Because we want to try to make that future, like make the best future you can imagine.

And I guess probably the best future is if people can have whatever they want from a goods and services standpoint or medical standpoint. And but at the same time, we don’t destroy nature, and we keep the rainforests and the beautiful national parks and all that stuff.

And so that’s what I mean by sustainable abundance, is that people can have whatever they want, have all their needs met, but we still keep all of the natural beauty that we want. I mean, if somebody can think of a better future, I’m all ears. But I think that’s probably the best way to go. So, yeah. Let’s see.

Full Self-Driving Technology

So, yes, as you know, every Tesla is designed to be autonomous. So the… it’s sometimes difficult to explain to people if they have not… or in fact, I’m sure you’ve all encountered this, where you try to tell people that the Tesla can drive itself, and they think you’re crazy or something. I mean, especially, like, apart from the Cybertruck, our cars look pretty normal. I mean, they’re good looking cars, but they don’t look super… they look normal.

But I guess it’s kind of like having a cat or like… and cat’s just sitting… let’s say you’ve got a cat and it’s like just sitting there on the couch. And you try to tell people that the cat can actually… it’s actually Puss in Boots and it can actually put on boots and a hat and swashbuckle and sing and dance. And people are like, no way, man, that’s a cat. Until the cat does all those things. And you’re like, damn, what the…?

So we’ve got millions of Tesla cars out there that are the kind of like Puss in Boots. They’re intelligent, but people don’t know that they’re intelligent. They look like normal cars, but actually, they’re super smart and can drive themselves. So I think that’s probably the single biggest thing we need to do is to educate potential customers that you can either have a cat that’s like normal cat or you can have Puss in Boots. And Puss in Boots is very cool.

That’s so we’ve… these days, when people come to our stores or even people that have the car haven’t turned it on, we find. And sometimes people have paid for FSD and haven’t turned it on. We’re like, what? You should at least try it once.

And so now we’re like the sales team and service team will actually sit with customers and say, look, let us show you how it works and how easy it is. And then once they’ve tried it for even just a few days, they can’t live without it.

And now with version fourteen, we’re actually getting to the point where we almost feel comfortable allowing people to text and drive, which is kind of the killer app because that’s really what people want to do and do do. And actually, now, the version’s… the car is a little strict about keeping your eyes on the road. And but I’m confident that in the next month or two, we should… we’re going to look closely at the safety statistics, but we will allow you to text and drive essentially. So yes.

It’s certainly been in the current situation, which often people will actually turn off FSD to text then turn it back on, which is less safe. So yes, that’s probably the single biggest thing is just get people aware of FSD.

Regulatory Approval Challenges

And then obviously, we need to get it approved in Europe. So we certainly appreciate the support of our customers in Europe pushing the regulators to approve FSD because you can’t even get a super… even just normal supervised FSD is not allowed in Europe currently, which doesn’t make any sense.

And I’ve had these like crazy conversations with the regulators that seem like a Franz Kafka novel, where I’m like, well, look, we have billions of kilometers of data that shows that FSD increases safety. And they’re like, well, we have to have all these committee meetings. I’m like, yes, but people’s lives are at stake here.

So definitely, a pressure from our customers in Europe to push the regulators to approve would be appreciated. And then we have partial approval in China, and we hopefully will have full approval in China around February or March or so. That’s what they’ve told us. Yeah.

But yeah. The fact that every Tesla car is capable of full self driving, every car we build and have built for the last several years is capable of full self driving is pretty wild, and most people don’t know that. So…

Cybercab: The Autonomous Robotaxi

And then we’ve got the first car that is specifically built for unsupervised full self driving to be a robotaxi. It’s called a Cybercab. It doesn’t even have pedals or steering wheel. Yeah. So there’s no side view mirrors. There’s no… yes. So it’s very much optimized for the lowest cost per mile in an autonomous mode.

And that production is happening right here in this factory, and we’ll be starting production in April next year.

So the way that Cybercab is designed is it’s designed, obviously, for a purely autonomous world. But also, the manufacturing system is unlike any other car. The manufacturing system of the Cybercab, it’s sort of… it’s closer to a high volume consumer electronics device than it is a car manufacturing line.

So the net result is that I think we should be able to achieve, I think, ultimately, less than a ten second cycle time, basically a unit every ten seconds. Maybe ultimately take a few years to get there, but it’s theoretically possible to get to a five second production time.

Tesla’s Production Capabilities and Future Vision

And so what that would mean is you could get on a line that would normally produce, say, five hundred thousand cars a year at a one minute cycle time, Model Y. This would be maybe as much as two million or three million, maybe ultimately it’s theoretically possible to achieve a five million unit production line if you can get to the five second cycle time. It’s a lot of cars. So these will be everywhere in the future. And we want to look futuristic, so it changes the look of the roads.

Optimus: The Humanoid Robot

The ingredients, when you look at what Optimus is, what’s required to make Optimus and the various ingredients, what do you need to do to make high volume humanoid robot production? I think it’s worth considering that really the cars we make are already robots, but they’re four wheeled robots. So Tesla is already the biggest robot manufacturer in the world because every car we make is a robot.

And when you break it down to the fundamental elements, you’ve got batteries, power electronics, motors, gearboxes. You’ve got connectivity. You’ve got a vision based AI. Hi, Optimus. And you know, all the various pieces that you need for a humanoid robot, you need the AI chip, you need the AI software, you need to be able to manage a large fleet. And so really, Optimus is a robot with arms and legs as opposed to a robot with wheels. So, you know, Tesla’s ideally suited, I think, to succeed in this arena.

You will see certainly many companies showing demonstration robots. There’s really three things that are super difficult about robots. One is the engineering of the forearm and hand because the human hand is an incredible thing, actually. It’s super dexterous. So engineering the hand really well, the real world AI, and then volume manufacturing. Those are generally the things that are missing. One or more of those things are missing from other companies. So Tesla is the only one that has all three of those.

Optimus Production and Development

So this is the Optimus kind of initial, it’s kind of a prototype production line. The high volume production line will be very automated, obviously, but this is really the production line that we use to make the prototypes. So you can get a sort of rough sense for what it takes to build the robot. Still pull the finger.

And then as I’ve said before, I think once we reach about one million units per year of sustained production or in excess of that, I think probably the cost of production is around twenty thousand dollars in current year dollars. So this will be certainly very affordable. And, yeah, like I said, I think Optimus will ultimately increase the size of the economy probably by a factor of ten or more.

You know, next year, we start production with Optimus version three. This is what you’re seeing here is Optimus version two point five. Optimus three is an incredibly good design. The Tesla engineering team is amazing. When you see Optimus three, it will seem as though that there’s someone like a person in a robot outfit, which is how we started with Optimus. Really, it’s going to be something special.

And then Optimus four, that hopefully starts production in twenty seven. And then Optimus five in twenty eight. So it’s kind of like an annual release cycle with significant improvements with each one and gigantic increases in the scale of production.

Full Self-Driving Progress

Sustainable abundance via AI and robotics. That’s the future we’re headed for. And as I think most people here know, the safety statistics show that miles driven on FSD are much safer than miles driven without it. So what this will translate to ultimately is saving the lives of millions of people and preventing hundreds of millions of accidents. So a massive increase in lives saved and tragedies avoided. It’s going to be amazing.

How many people here have tried fourteen point one? Okay. All right. Cool. Yeah. You can see that even with the point releases, it’s getting quite a bit better. It should be pretty smooth at this point. But really, fourteen point two, there are major changes to fourteen point two and then fourteen point three. And I think by fourteen point three is when we’re really going to be at the point where you can just pretty much fall asleep and wake up at your destination.

AI Chip Development

And then I’ve been putting a lot of time into the new Tesla chip design, because in order to have a functional robot, you have to have a great AI chip. And it needs to be an inexpensive chip, and it needs to be very power efficient. So we believe the AI5 chip will be probably about a third of the power of, say, something like a Blackwell, NVIDIA Blackwell, which is a great chip, for roughly comparable performance and much less than ten percent of the cost.

So this is a chip that is very much optimized for the Tesla AI software stack. It’s not meant to be a general purpose chip. It’s meant to be an amazing chip for the Tesla AI software. And I mean, a couple of things that I think make, how is Tesla able to achieve such an improvement? I think it is because we are specialized. We’re not trying, NVIDIA has to serve the superset of all past and future customers. So all of their requirements, all of the software that they’ve written has to work, which is a very difficult problem, whereas we just need to make it work for our software. And so we were able to simplify the chip dramatically.

And then we also, I think we’re unique in this, but we have an integer based system. Integer operations are fundamentally more efficient than floating point operations. So we can do floating point, but the vast majority of our inference is done in integer, which is, if you’re familiar with sort of logic gates, the simplicity of integer, integer is much more power efficient, much more silicon efficient. But you actually have to train for integer inference, which everyone else is training for floating point. That’s kind of a niche technical detail, but it’s actually very important.

So, yes, this is going to be a great chip. So this chip will be made in basically in four places: TSMC Taiwan, Samsung Korea, TSMC Arizona and TSMC Texas. And we already know what improvements to make for AI6. So I’m hopeful that we can within less than a year of AI5 starting production, we can actually transition in the same fab to AI6 and double all of the performance metrics.

I’m super hardcore on chips right now, as you may be able to tell. I have chips on the brain. I dream about chips, literally. I can draw the, you know, the at least the broad brush stroke physical design of the AI five chip by heart at this point. It’s a good chip. It’s a good chip, sir.

Chip Production Challenges

So this is really key. Now one of the things I’m trying to figure out is how do we make enough chips? So I have a lot of respect for the Tesla partners, TSMC and Samsung. Maybe we’ll do something with Intel. We haven’t signed any deal, but it’s probably worth having discussions with Intel.

But even when we extrapolate the best case scenario for chip production from our suppliers, it’s still not enough. So I think we may have to do a Tesla TeraFab. So it’s like Giga, but way bigger. I can’t see any other way to get to the volume of chips that we’re looking for. So I think we’re probably going to have to build a gigantic chip fab. Got to be done.

Sustainable Energy Vision

So anyway, some of the stuff I’ve already talked about. Yep. We’ve done a tremendous amount for sustainable energy, and that is only going to grow over time. The world is moving towards a solar battery economy, which is ultimately where it was going to go anyway, but what Tesla does is accelerate that outcome.

Sometimes people don’t understand quite how much energy comes from the sun. So the sun is ninety nine point eight percent of all mass in the solar system. Jupiter being point one percent and then point one percent is miscellaneous, Earth being in the miscellaneous category. So the total amount of energy, the sun, people would say, well, we’ll build fusion reactors on Earth. It’s like, well, actually, the giant fusion reactor in the sky is basically impossible to beat to such a degree that even if you could burn Jupiter in a thermonuclear reactor, the amount of energy produced by the sun would still round up to a hundred percent. That’s how much energy the sun produces.

So solar power is necessarily the future. And I think there’s going to be a lot of solar powered AI satellites. And I think Tesla’s going to play a role in that.

Product Line Updates

We’ve obviously refreshed the product line, so S three X Y. If people haven’t tried the model S, three, X or Y or the Cybertruck, I recommend at least getting a test drive or a test ride as the case may be. Try out the full self driving, and I think you’ll be blown away. So those who do not, if you might be listening and don’t have a Tesla, you should try one.

And, of course, we’ve got the Cybertruck, which is the toughest truck of all time. It’s literally bulletproof, faster than a Porsche nine eleven, and can out tow a Ford F three fifty. So it’s a great car, great truck.

And then starting next year, we manufacture the Tesla Semi. So this, we already have a lot of prototype Tesla Semis in operation. PepsiCo and other companies have been using the Tesla Semi for quite some time. But we will start volume production at our Northern Nevada factory in twenty twenty six. So we got two big products or three, three massive products starting production next year. We got Optimus. We got Tesla Semi, and we got the CyberCab.

Battery Technology and Energy Storage

And then battery packs. So if you look at total US power generation capability, it’s roughly a terawatt. But the average power usage is less than half a terawatt. And that’s because there are big differences in power usage between day and night. So the daily and seasonal variations in power consumption mean that the United States and really every country is only using about half, is only producing about half as much electrical energy as it could.

Because without batteries, there’s no effective way to buffer the energy. So what batteries actually enable is even if you don’t build any incremental power plants, you could double the energy output of the United States just with batteries. This is a super big deal. And in fact, I think that’s really where most of the incremental energy production in the United States is going to come from, is literally batteries. So a bigger deal than it may seem.

And then we keep improving the battery design, so the MegaBlock, which makes it really easy to deploy utility scale batteries. So we’ve just simplified and brought more of the components to be internal to the batteries. So you can just show up and drop off a battery and it works.

And then hopefully with, well, not hopefully. Over time, we will actually add more and more of the power electronics so that MegaPack will actually be able to output up to thirty five kilovolts directly. So you won’t need a substation is what I’m saying. You can just literally drop it off, kind of like the way that a Powerwall you just connect it to the house. The utility wires go on one side and the other side goes to the house mains, and that’s it. So we want to get mega pack to the point where you just literally take the utility wires and you plug them in, and it just works.

Supercharger Network Expansion

Then we’ve also built the world’s largest supercharger network. So we do a lot of things here at Tesla. That’s the biggest supercharger network in the world by far. And ultimately, you’ll be able to go anywhere on earth using a Tesla supercharger. And it’s all pretty close to anywhere on earth, but it’s going to be ultimately just anywhere. It will just work anywhere.

So the supercharger team has done great work expanding that and improving the efficiency of the supercharger network. And in North America, they did such a good job that the other car companies basically said, well, we’ll just use the Tesla supercharger network. Like, okay, sounds good to us.

Factory Safety and Company Culture

It’s always important to have a plan on safety in the factory. So we continue to improve safety for our factory workers. We care a lot about their well-being. And, you know, one way you can just tell if a company is a good company or not, if you just walk through the factory or walk through the office and catch the vibe. And the vibe in the Tesla factory is good. People are happy. That’s how you know it’s a good company.

Supply Chain and Raw Materials

We’ve also put a lot of investment into raw materials. So we’ve built in South Texas and Corpus Christi the biggest lithium refinery outside of China, I believe. So it’s going to, it’s starting off at about fifty gigawatt hours of lithium, and we’ll expand from there. So this is very important to have in a worst case scenario that we have the ingredients necessary to make a battery. Very important.

And then we’ve got here on this site the cathode factory, which is just the sort of giant building about a half mile that way. And we’re just making sure that we, from a supply chain standpoint, are resilient against any potential geopolitical challenges.

Tesla’s 4680 Cell Production and Future Applications

And then also at this factory, we also make the 4680 cell, which is getting better and better. And that 4680 cell will be used in the CyberCab – it is being used in the CyberTruck and will be used in the CyberCab and also in Optimus. So that’s going well. But we continue, obviously, to get sales from many suppliers. It’s kind of like the chip fab thing.

We’ll take as many chips as our suppliers can provide us. But then beyond that, if they can’t provide us with any incremental cells or chips, we kind of have to make them ourselves or we get stuck. That’s the Tesla Semi Factory. So it’s going to be pretty cool to see these going down the road in scale.

So that’s basic plan. Sustainable abundance for all.

Q&A Session Begins

ELON MUSK: All right. So yes, I guess we can go into Q and A now. Maybe at the next Annual Shareholder Meeting, we’ll have Optimus take some of the questions. That would be cool. So I see Alexander, well, thank you for your help, by the way. Please go ahead.

AUDIENCE QUESTION: Thank you. Is that a mic? Is it no. Let me hold it. It’s okay. Well, what a year it’s been. Right? I mean, just a year ago, President Trump got elected on the same day. These twelve months have been a heck of twelve months. Thank you to the board because I think they had to weather quite some storms with institutional investors and obviously thank you to you. And we stand with you. I think we showed it – we will show it.

So we would like to express a wish, please. This is a nice venue. We love coming to the factory and I think it’s actually great we’re doing this at the factory. But there are thousands of retail investors who are crying because they cannot. They come to me. I love playing the mama, but I now give it to you. Please organize a bigger venue. We’re bigger than Berkshire, and we will do better than Berkshire. Okay.

ELON MUSK: Sure. And we can pay.

Yeah. Actually, Tesla will be way, way, way bigger than Berkshire long term. It’s going to be kind of nutty. So, all right. We’ll do the next one. Maybe we’ll do it in the – yeah. Like, yeah. Maybe the downtown arena or the soccer stadium or something like that. And get your security checked. We want to make sure that you’re safe.

AUDIENCE QUESTION: What if I just want all been weaved. But we want to party. And if you can bring the other Elon companies there as well, investors would really appreciate it.

ELON MUSK: All right. Sounds good. Thank you very much for listening to us.

FSD Transfer and Ownership Questions

AUDIENCE QUESTION: All right. Elon, as a father, I just want to first thank you for the everything you’re doing in the world, especially freedom of speech. Thank you. And one question. Will you or Tesla ever consider FSD tied to an owner’s account rather than a vehicle to encourage more frequent upgrades provided the transfer is to only a brand new Tesla vehicle while fostering brand loyalty? If the vehicle is sold or traded without upgrade to another Tesla, FSD ownership would end?

ELON MUSK: Well, we have done that a few times. I guess we could extend it again. I will extend it for at least another quarter and then play it by ear after that.

Bitcoin and Wheelchair Accessible Vehicles

AUDIENCE QUESTION: All right. Howdy, Elon. Congrats on not having to show up to work for free anymore. We now have over a $40 billion war chest. We’re cash flow positive and remain – we know how you feel about fiat already. Is it time to take a look at Bitcoin? What’s your belief on that? Also, you’ve hinted towards that there’s a wheelchair accessible model in the works. Were you referring to the Robovan? And if so, can we please speed up production to help the least fortunate?

ELON MUSK: Sure. Yeah. Obviously, we need a vehicle that’s big enough to fit a wheelchair accessible. So I think is the Robovan or robust or whatever we call it. I mean, it’s not like we’re slowing down because we want to slow down. It’s like we’re spinning like a zillion plates here.

So but I do think it would be very cool because I think aesthetically as well, it just would change the look of the roads and make it feel like the future. So it won’t be long before we make that. But since we do have Optimus, we’ve got CyberCab, Optimus and Semi all next year. It will probably have to be maybe the year – a couple of years from now or something like that. But we certainly will make a wheelchair accessible vehicle.

Dry Cathode Production Update

AUDIENCE QUESTION: It’s Patoshi. I was privileged enough to attend the Investor Day. And you’ve also talked about the factory being a product. I saw the dry cathode method and so forth, and I wanted to know the progress in that. And also would Optimus be working on that in the future production line in the future?

ELON MUSK: Yes. I guess the dry cathode, man, that’s turned out to be a lot harder than we thought. So I mean, it does look like it’s going to be successful, and it will have some cost advantage relative to wet cathode. But if I had to wind the clock back, I would probably have gone with wet cathode instead of dry cathode because it just turned out to be a lot harder to make it high capable of high volume production with super high reliability. So yes.

But we will be scaling up battery cell production at Tesla and looking for cell production from our suppliers as well because we’re going to be ramping up production very dramatically at Tesla.

Production Ramp Plans and Autonomy

Now that we believe we have full self-driving, that we have autonomy solved or at least within a few months of having it unsupervised autonomy solved at a reliability level significantly better than human – that means it’s time to ramp up production because the value proposition is now much greater than a regular car.

The killer app really is for people, can you text and drive? Or can you sleep and drive? Can the car take you to your destination? Or do you need to pay attention and be and have to drive it? And before we allow the car to be driven without paying attention, we need to make sure it’s very safe. Like I said, we’re on the cusp of that. I know I’ve said that a few times, we really are at this point. And you can feel it for yourselves with the 14.1 release.

So we’re going to try to – we’re going to push to expand vehicle production as fast as we possibly can. So aspirationally, we’d aim to increase vehicle production by about 50% by the end of next year. So that’s – it’s very hard to increase production, but that’s roughly – I don’t know, maybe we get to like – I’m just guessing, at exit rate by the end of next year of around 2.6 million, 2.7 million vehicles annualized production and then aim to get to maybe 4 million by the annualized rate by the end of ’27 and then maybe 5 million by the end of ’28.

Those are rough – those are our aspirational goals. So these are – this is a gigantic increase in output, which means that the entire supply chain has to move in unison with that increase in volume. And the nature producing a large complex product is that it moves as fast as the least lucky, dumbest element in the entire system, and there’s 10,000 plus items.

But like I said, this really is a new – it’s not just a new chapter for Tesla, it’s a new book. And that new book is massively increasing vehicle production and ramping up Optimus production faster than anything’s ever been ramped up before in history.

Roadster Unveil and Founder’s Series

AUDIENCE QUESTION: Awesome. Elon, thank you. Thank you from all of us. The retail shareholders really care, and so I echo the sentiment of a larger venue where more can come. As a testament to that, I was here – I was fortunate enough to be here last year. And since then, touring the factory, talking to people that work here, I’m just a retail shareholder, but increased my holdings twelve times. So I know it’s really engaging and gives people confidence. And so thank you for having us. I do echo that I hope it grows.

Last year, I’m the one that asked you about your well-being and safety. Oh, yes. It’s all live. It was a broad general question and it was before some of the uncertainty that’s unfolded since then. So I hope it had a positive impact and we all care. And so my question this year, you’ve talked recently about the most mind-blowing product demo of all time and I shot it being the most memorable product ever. Roadster. Yes, yes.

And I have patiently been waiting on my Founder’s Series Roadster reservation. Yes. So on behalf of the Founder’s Series guys that have stuck in there, can we be invited to this unveil?

ELON MUSK: Oh, yes. Sure. Absolutely. Definitely. Okay. Yes. So all Founder Series can be invited?

Yes, yes. I mean, it’s the least we could do, frankly, for people that have – our long suffering Roadster reservation holders. I feel confident in saying it will be the most exciting product unveil ever. And I hope that – whether it goes well or doesn’t go well.

AUDIENCE QUESTION: Since I’m up here, can I get the first one?

ELON MUSK: Well, I guess it’s according to whoever put down their deposit in that sequence. So that’s the – but you’ll get a very early one. And I mean, the new Roadster is very much sort of like – it’s not even the icing on the cake, it’s the cherry on the icing on the cake. So I mean, it’s really kind of like – it’s not essential for sustainable abundance, let me put it that way.

But I do think there should be very cool technology in the world that is – you know, it’s way beyond anything that’s ever existed. And I think I’d like those – like, even if I could never have access to those things, I’d like to know that they exist and see the future happening. So I think it will be inspiring to a lot of people. And just it’s – it’s like the coolest car, if it even is a car, that has ever – that will probably ever exist.

Chip Production and Tera Factory Plans

AUDIENCE QUESTION: Hi, Elon. Congrats on the proposal plan. That was amazing, the compensation. Question back to chips. So chips, chips, chips. Chips will be the limiting factor to the future. So on that –

ELON MUSK: Yes. Chips and electricity are the two limiting factors.

AUDIENCE QUESTION: Yeah. And we got the energy and power and energy packs ready to roll. So I think on the chips, I think you said TSMC, Samsung, perhaps Intel 14A and several different sites. I heard a couple of U.S. factory sources, which is mean, we’re like everyone.

ELON MUSK: Everyone. It’s like – yeah. Yeah.

AUDIENCE QUESTION: And so I guess – is there an open door in the future of investing directly into some of those boundaries? And second question, how big is a Tera factory? Can you put that in scale?

ELON MUSK: Oh, yes, yes. That’s a point. A semiconductor Tera factory? Yes. Well, I mean, thing is that we actually have agreed to buy all the chips that are made from the fab. So it’s basically a money printing machine for TSMC and Samsung. It’s like literally the faster you make the chips, the faster we send them money. But it’s still not going at just fast enough.

So that’s why I think, as far as I can see, the only option is to go build some like very big chip fab. And then you go to solve memory and packaging too. But otherwise, you just tap out at whatever the chip production rate is. And so I guess, Tera would be – you’d want to say it’s got to be at least 100,000 wafer starts per month size fab. And maybe that would be one of ten in a complex. So it would ultimately be one million wafer starts per month.

Yeah. Exactly. You can tell when it gets the giggle factor, that’s probably a good sign that we’re onto something special. But I wouldn’t be surprised if long term, it’s like a million wafers a month.

Tesla on Mars and Moon

AUDIENCE QUESTION: Hi, Elon. I’m a long-term investor, so I’ve been holding the shares for twelve years. I worked at the autopilot team development for ten years, and brought my dad here from Brazil. We actually won the Tesla Vision contest with the Cybertruck BVL. So I hope you get to see that at some point. So thanks for the free Model Y.

And my question is about, obviously, market expansion, but not only South America, Brazil, but also into Mars, like, with the upcoming rendezvous of Mars and Earth. What’s going to be in the payload? You know? Where are we going to send there?

ELON MUSK: Well, Optimus is going to play a big role. Optimus and, I think, Tesla vehicles will play a big role on the moon and Mars. So for a moon base and a Mars city, Tesla vehicles and Optimus robots are natural fit for building and operating a moon base than a Mars city.

AUDIENCE QUESTION: So sorry? Cybertruck also?

ELON MUSK: Yeah. Yeah. It’s a Cybertruck. We’ll need to drive around in a pressurized vehicle if there’s a person inside. But, yeah, it’ll be something cool, next level moon buggy or Mars buggy.

Autonomy and Deflationary Impact

AUDIENCE QUESTION: So all right. Hi, Mr. Musk, Gorev. Been a fan of yours since 2006. I think I saw a piece in Popular Science Magazine. It was really cool, and I think I was fifteen at the time. Shareholder since ten years now. It’s been really, really rewarding. It’s changed my life. So thank you very much to you and Tesla.

My question is regarding Tesla’s mission for a sustainable future as it pertains to autonomy. I personally fully expect a deflationary period after – well, unlocked by autonomy basically, both in moving humans and goods and whatnot, excluding Optimus even.

Cost Per Mile and Economic Viability

What efforts is Tesla going to focus on to reduce the dollar per mile? Rough math, I think like $0.30 a mile would be really nice. $0.50 is pretty good too, I mean, looking at inflation later on. And then I guess the second part of that, how low does it have to be for people to just stop buying cars like where it doesn’t make economic sense to do that? I expect that to affect economies of scale and then further increase the pricing of vehicles thereon out. So like what is that node at which inflection happens?

ELON MUSK: Well, in terms of cost per mile, I mean, we do see a path with a lot of work to get below $0.20 a mile in current year dollars. And I somewhat agree that things will probably be deflationary, as productivity increases because you can think of money supply as being the ratio of goods and services to like what’s the growth in goods and services versus the growth in the money supply? That ratio is basically inflation. And so if the output of goods and services grows faster than the money supply, then you necessarily have deflation or vice versa.

They try to make it sound complicated, but it’s not. So I’m not sure that even government overspending can actually—I think government overspending will be lower than the increase in productivity of goods and services, which would imply deflation as you expect.

AUDIENCE QUESTION: What about economies of scale and the impact it has to how you respond as an automotive company when people stop potentially buying cars?

ELON MUSK: Economies—sorry, economies of scale? In like auto manufacturing, for instance, it only makes sense if lots of people buy your vehicles. Oh, the total number of vehicles will decrease. The sort of vehicle fleet out there is about two billion cars. Two billion if you add up old cars and trucks that are not at a scrap yard, I think it’s around two billion. But that number would decrease with autonomous vehicles.

So the total fleet size would drop. I actually think miles driven will increase because it is now much less painful to travel somewhere. So if somebody is thinking about traveling across a busy city, then they’ll take into account, well, how much pain do I have to deal with if I have to go through two hours of traffic? I probably won’t do it. But if you’re just, say, sitting in a Cybercab watching a movie or doing some work, then it’s just like sitting in a little lounge.

And so I think you’ll see probably a significant increase in total miles driven, but at the same time, a decrease in the total active fleet of vehicles.

Cybercab Production and Regulatory Approval

AUDIENCE QUESTION: I’d just like to reiterate how grateful we all are to have you onboard and ready to lead us to another seven trillion dollars in market cap, at least. Obviously. Thank you. My question is, how much of a concern is it that when Cybercab starts production in Q2 next year, that regulation won’t be there yet to where you can deploy Cybercabs being produced? Or are you guys confident that every Cybercab you guys make, you’ll be able to deploy?

ELON MUSK: Yeah. I think the rate at which we receive regulatory approval will roughly match the rate of Cybercab production. It will be maybe a little tight, but it’s about right. And I’d like to thank Waymo for paving the path here. It’s very helpful. So, yeah, but I think we’ll be able to deploy all the Cybercabs that we produce.

And the other thing is, like, once it becomes extremely normal in cities, it’s just going to become like, the regulators will have just fewer and fewer reasons to say no. And then you’ve got this—you know, you’ve got the accident statistics at scale and you can show that autonomous miles save lives, then and you’ve got unequivocal, you know, billions of miles to prove it, then I think it’s hard for regulators to say no.

Optimus and Consciousness Transfer

AUDIENCE QUESTION: First of all, Elon, thank you so much for everything you do for the Tesla shareholders. Thank you. Do you see a path for Optimus to have consciousness downloaded to it? You mean human consciousness?

ELON MUSK: Yeah. I mean, it’s not immediate. But if you say that down the road, would you be able to, say, with the Neuralink, have a snapshot of or what is an approximate snapshot of somebody’s mind and then upload that approximate snapshot to an Optimus body, I think that at some point, that technology becomes possible. And it’s probably less than twenty years.

But of course, you won’t quite be the same. You’re a little different because you’ll be in a robot body. And the mental snapshot will not be precise. It’ll be probably pretty close, but not exactly the same. On the other hand, are you the same person that you were five years ago? Nope. I mean, a lot of things have changed. So yeah, but I guess at some point, if you want to be uploaded to a robot body, my guess is that becomes possible.

Space-Based Solar Power

AUDIENCE QUESTION: Hi, Elon. Space-based data center is a great idea, and I agree with that. Yeah. I was curious on your views on space-based solar power, the idea of beaming down microwave energy down to earth so that you can just point it to where it needs to go without transmission, without distribution lines, and it’s more energy dense, so, you know, less land use. Just curious on your views.

ELON MUSK: Well, space solar power—until the advent of something like Starship, where the cost per ton to orbit drops by orders of magnitude, the cost of getting payload to orbit is so high that there was no possibility of space solar power solving anything, really.

Now with Starship, like, I see a path to Starship cost per ton to orbit being lower than air flight. Like, if you were to fly, you know, do a long distance air flight with cargo, like, say, took a 747 from here to Sydney, Australia or something like that, I think, ultimately, Starship will be able to do that trip for less cost per ton than an aircraft. So then you—so now you’ve got that opens up a very wide range of possibilities.

Like, the most obvious one, I think, is actually solar powered AI satellites, sort of to move the AI to orbit and essentially deep space over time. Because you can actually access over a billion times more energy from the sun in deep space than you can on Earth, scaling if you—to scale to Kardashev—to make any progress on a Kardashev Type II scale, which is using some nontrivial amount of energy from the sun, you kind of have to do space solar power.

Now you could only beam a tiny amount of that back to Earth or you would melt Earth. So Earth actually receives a very, very tiny amount of the sun’s energy. We’re—I mean, Earth is a tiny dust mote. We see that Earth to scale with the sun, we look like a little crumb. So to scale civilization, like I said, to be at all relevant on a Kardashev Type II scale, like to even use a millionth of a percent of the sun’s energy, you really have to have use solar power in deep space.

And you could beam some of that back to Earth too, but you can only beam a tiny bit of it back or you’d melt Earth.

SpaceX Investment Opportunities for Tesla Shareholders

AUDIENCE QUESTION: Elon, look around you. This is a very, very small sample of Tesla soldiers. Maybe, actually, I should say, Elon Musk’s soldiers.

ELON MUSK: Well, thank you for your support.

AUDIENCE QUESTION: And thank you, everyone. So I’d just like to say thank you from the bottom of my heart for your support. Thank you. And thank you, everyone out there. So I know for sure a lot of them sold the farm to buy Tesla. And they stuck with Tesla through thick and thin, good days and bad days. Yes. My question to you is, how do you feel about repeating the success but in a safer way where you get qualified Tesla retail investor only to invest in SpaceX, avoiding all these market manipulator, those crooks, and these short sellers.

ELON MUSK: Yeah. It is a tough problem that you highlight. I mean, basically, unfortunately, over time, the parasitic load of being a public company has just grown over time. And so you get all these spurious lawsuits, obviously, and they just make it very difficult to operate effectively as public company. So but I do want to try to figure out some way for Tesla shareholders to participate in SpaceX. That would be very cool.

I’ve been giving a lot of thought to how to give people access to SpaceX stock because I do want supporters to have SpaceX stock. But there’s a sort of 2,500 shareholder threshold before you become a de facto public company. But I don’t know. Maybe at some point Tesla—maybe at some point SpaceX should become a public company despite all the downsides of being public.

Elon’s Strategic Thinking and AI Development

AUDIENCE QUESTION: First of all, thank you very much, Elon. Just an amazing job you’re doing, not only for Tesla shareholders, but the humanity in general. So we’ve got a couple of questions many of us are asking. Like we want to know, many of us think you are one of the most consequential business people on earth ever. And we want to understand how do you think, like, for example, like a couple of—one, how did you know in the Master Plan Part Two, this is like 2018 or something like that, you calculated at that point it takes six billion miles of FSD miles driven before maybe the world, the regulatory, would approve it.

And then the second is like when you were deciding if Tesla is going to have the hardware chips, AI chips, did you know at that time that at some point when you get the AI5, it’s going to be used not only for cars but for bots and for AI data centers? Like was that luck a little bit? Or was it like you kind of knew that that was going to happen?

ELON MUSK: Well, generally, I mean, in terms of the estimates, like for the self-driving stuff, generally try to get things to within an order of magnitude. So it seemed to me like probably—and this was technically in kilometers, but it would be closer to ten billion kilometers, which is roughly six billion miles, than it would be to one billion. But I thought it would not take one hundred billion kilometers. So it’s really just you’re trying to—when you’re trying to guess something where there’s a lot of uncertainty, just try to get the estimate to the nearest order of magnitude, closest factor of ten. And that’s why I said probably around ten billion kilometers or six billion miles.

And then, yeah, chip—the reason Tesla created a chip team, and it’s important to note, like, Tesla is like a dozen startups in one. And, you know, we’ve only really done one major acquisition, which is SolarCity, and then some very small ones. So all of this is almost all of this is organic. So I built the chip team from scratch and the AI team from scratch. It was just because it became a limiting factor.

So for Hardware 2, we used NVIDIA. But NVIDIA was, at that time, focused on making really AI server hardware, which obviously was a smart bet. They’re currently the most valuable company in the world. And Jensen Huang and his team have done an incredible job at NVIDIA. My hats off to them. I’m a huge admirer of Jensen and NVIDIA. They’ve done amazing work.

But they didn’t want to do a low cost, power efficient car computer at the time, AI car computer. So I was like, well, okay, I guess we need to start a chip team to solve that. So then that’s when I hired Jim Keller, and we built the chip team and did AI3, then AI4. And then we—to be honest, we made some mistakes there with AI5, but now AI5 is back on track. And we’ll have a very rapid cadence to AI6 and so forth.

And this is really necessary for the car to—like with AI4, I think we can get to 200 or 300 percent better than human safety, maybe 400 percent better. But with AI5, I think we can do 1,000 percent better or maybe even better than that than human safety. So at a point, actually, it might be too much intelligence for a car.

So, like, I was thinking, what if you get stuck in a car and you have too much intelligence? But then one of the things we could do is when the car is idle is use the car as a massive distributed AI inference fleet. So with the concerned customers, we’re like, do you want your car to earn money for you while it’s sitting in your garage at night? I don’t know. We’ll pay $100 a month or $200 a month or whatever the right number is. If you allow Tesla to do AI inference workloads when you’re not using your car.

So that will also help the AI in the car not get bored. Because, like, I sort of imagined, like, what if I got stuck in a car? You know? And then—well and the highlight of your day was driving. It’s like, you know—but they don’t always want to drive.

Distributed AI Inference and Future Computing Power

So then what do you do the rest of the time? So I think Tesla could actually end up having the largest—Tesla might end up having the most amount of AI inference compute in the world. Like, if you think, maybe if we had one hundred million car fleet, and at some point, we may have more than one hundred million car fleet, and they’ll have AI six, AI seven, you know. And if you’re able to run a kilowatt of inference on a one hundred million car fleet, now you’ve got one hundred gigawatts of distributed inference with built in cooling and power electronics and distributed power.

Probably the market is valuing that as zero point zero right now is my guess. But it seems like an obvious thing to do. If you’ve got distributed inference AI and you’ve got the power and the cooling, which is very difficult to do the power and the cooling, and one hundred gigawatts is a lot. I mean, the average power consumption in the U.S., I think, is around four sixty gigawatts for the—that’s the entire electrical consumption of the U.S.

So if you do it one hundred gigawatts, that would be a pretty big number. But, yeah, it’s basically something as a limiting factor, and then we take actions to address the limiting factor.

AUDIENCE QUESTION: A quick follow-up. Thank you for that very much. A request for you. So you guys just unveiled the Cyber Bear. Looks fabulous.

ELON MUSK: Oh, yeah.

AUDIENCE QUESTION: We’d like to—it’s beautiful. We’d want you guys or maybe do a Cyber Bull here in Giga, Texas. My name is Herbert. I’ve got a Brighter with Herbert channel on YouTube. This is the Cyber Bulls. We are representing the Tesla Bulls, we stand with you, Elon. But wouldn’t it be cool to have a Cyber Bull right here in—

ELON MUSK: Like a Cyber Longhorn?

AUDIENCE QUESTION: Cyber longhorn.

ELON MUSK: All right. We’ll do a cyber longhorn for the factory.

AUDIENCE QUESTION: All right.

Tesla Giveaway and Roadster Updates

AUDIENCE QUESTION: Good afternoon. I’m very excited to ask this question. I’ve dreamed of giving away a Tesla for a very, very long time, and I finally wore EV Jack down enough that they’re willing to foot the bill for it. But it turns out to give away a Tesla, I have to have your permission to say we’re giving away a Tesla.

ELON MUSK: Yep. My permission. Get away. Perfect. You don’t have to do anything. Tesla does energy. We’re going to go through the normal channels. We’ll buy it from a store. All that—sure. If you can give away Tesla, it’s totally cool. Certainly, you don’t need my permission to give away a car.

We’ll take, like, maybe a couple more questions and then call it a night. Okay. All right.

AUDIENCE QUESTION: Hi, Elon. My name is Jonathan. You mentioned that the Roadster will have more tech than all the James Bond vehicles combined. Do you think that any of that tech will make it into the current vehicle lineup?

ELON MUSK: No.

AUDIENCE QUESTION: And to follow-up on that, do you have any estimate of production or delivery time lines for the Roadster?

ELON MUSK: I guess, well, so we’re aiming for the—so the product unveiled will be of the Roadster two, which will be very different from what we’ve shown previously. That demo event will be April one of next year. I have some deniability because, like, I could say I was just kidding. But we are actually tentatively aiming for April first for what I think will be the most exciting, whether it works or not, demo ever of any product.

And then I guess production is probably about twelve to eighteen months after that. I think production is probably a year or so after that. Well, I can’t give away secrets, but you won’t be disappointed.

All right. We’ll take one last question, I guess.

Future of Abundance and AI Governance

AUDIENCE QUESTION: All right. Hi, Elon. I’m really excited about this future of sustainable abundance that we’re talking about. I mean, you’re going to be saving a lot of lives with FSD, but the number of lives that will be saved and improved with this future vision you have is really inspiring and very exciting.

So even today, you’ve mentioned that in a post scarcity world, the role of money could diminish or become obsolete. Given that much of today’s power, including yours, is tied to wealth, do you think achieving this abundance would require powerful people to relinquish their power? And how might we address resistance from those who hold power to make this vision a reality?

ELON MUSK: Well, I mean, I think actually long term, the AI is going to be in charge, to be totally frank, not humans. If artificial intelligence vastly exceeds the sum of human intelligence, it is difficult to imagine that any humans will actually be in charge. So we just need to make sure that AI is friendly.

AUDIENCE QUESTION: Thank you. Is that the question?

ELON MUSK: Go ahead. Sure. Yes. Okay.

Insurance Challenges and Solutions

AUDIENCE QUESTION: Sorry, Elon. Okay. Yes. So I’m CyberKat on X, and I’m doing YouTube and content creators. There’s one thing I always heard about Tesla owners or people who want to buy Tesla complain about that is about a super expensive insurance, right? And the thing is Tesla, I know Tesla also do insurance. However, it’s not cover every place, right? Like based on Boston, I don’t have too much options. It’s super expensive.

And the other point is the FSD is very safe right now. I’ve been using FSD for about four years. Right? It’s getting to a point. It’s like almost unsupervised. However, the insurance still does not take this into consideration. They don’t ask you whether you have FSD or not. And they don’t know how much you travel with FSD. And that is not a part of the risk prediction kind of thing. So I feel like what is—what’s your thought about insurance going forward, especially when we’re getting close to the autonomy? What is—like either using your own or with the external partnership. For example, there is a company called Laminate.

ELON MUSK: Need to not have the questions be super long. I mean, Tesla Insurance is trying to expand as quickly as possible, but the regulatory structure for insurance is extremely complex and works on a state by state basis. So it’s really somewhat of a racket. And the rules for insurance are different with every state. It’s a very, very complicated thing.

So yes, there’s—but I’m aware that insurance often is too expensive and doesn’t take the right things into account. But so all I can say to that is, yes, we’ll keep expanding Tesla Insurance. When the car is operating as the cybercab, Tesla will simply self insure. So that kind of solves that. But insurance is a real pain in the neck for sure.

But okay, I do need to end this at some point. I’ll take one question and one question there.

Optimus Training and XAI Partnership

AUDIENCE QUESTION: All right. Thanks, Elon, for taking my question. I appreciate it. My question has to do with compute and what the build out or how much is necessary to train Optimus and actually get them to a very household, meaningful robot that can do things, and if the partnership with xAI would help accelerate that?

ELON MUSK: Yeah. There’s a lot of training compute needed for Optimus. And because the AI chip in the robot is relatively weak because it’s really limited on power, you can make up with that with a lot of training to have a lot of training result in a very efficient AI that can run on a low power chip in robot. So we will actually have to spend a lot of money on training. Like, ultimately, it will be tens of billions of dollars on training compute. So it’s a big number.

AUDIENCE QUESTION: Would a partnership with xAI help accelerate that?

ELON MUSK: Yeah, I think potentially. Yeah, I think could—yeah, I think there’s potential for accelerating that. So, yeah, did the xAI investment thing get approved? Yes. No? Yes? Okay. Okay. Whatever. You know, whatever, like, it’s like, Tesla and some other company that I have an interest in, and it’s like always quite complicated to do things. It has to go through a lot of hoops to happen.

But I do think there’s a lot of potential for collaboration with xAI in the future and with SpaceX. All right. Okay. This is the last one. Yeah.

App Language Support

AUDIENCE QUESTION: Sorry. Thank you so much. Captain Eli on X, I support you. Thanks so much for everything you do. Very simple question. I’m from Israel. I don’t represent a lot of people, but people do ask me, and I’m going to ask you. Any chance to have the app in other languages like Hebrew, for example? Some people struggle with—

ELON MUSK: You mean the app?

AUDIENCE QUESTION: The app itself. Yeah. Just the app. And a lot of people don’t speak English, so it’s not—

ELON MUSK: Shoot. I thought we had it in all languages. Okay. Well, definitely, the app needs to be in all languages. All right.

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