Tesla is betting its future on Optimus. Here's what we know about Elon Musk's robot.

• Tesla says production of its Optimus robot will begin "soon" at its Fremont factory.
• Musk says intelligence, human-like hands, and mass production are the biggest hurdles.
• Musk says Optimus could create a world of "sustainable abundance," making human labor optional.

Elon Musk built Tesla into the world's most valuable carmaker. Now he's betting the company's future on a robot that walks on two legs.

Musk predicts its robot, Optimus, could become "the biggest product ever," with legions of the humanoid robots working in factories, doing household chores, and eventually building more robots. He even has a name for them in the plural: "Optimi."

But Tesla has yet to prove the robot can navigate the physical world or perform useful work autonomously, much less that it can be manufactured by the millions.

On Tesla's earnings call this week, Musk offered few details about Optimus and tempered expectations for how quickly production would increase. He said Tesla would begin producing its third-generation robot "soon" in Fremont in the San Francisco Bay Area.

Tesla is competing in an increasingly crowded humanoid market. Agility Robotics, which plans to go public, has deployed its Digit robot across nine customer facilities, while Figure AI has announced deployments in logistics and distribution centers this year. Sunday Robotics, 1X, and Weave Robotics are preparing to ship robots into homes this fall.

Guy Hoffman, an associate professor of mechanical and aerospace engineering at Cornell University who leads its human-robot collaboration lab, called humanoids a "fantasy product."

Autonomous cars took about 20 years to reach the market after the technology was first shown to work, he told Business Insider. Building humanoids is even harder, and a fully autonomous machine has yet to be developed.

"Humanoid robots are a very risky bet," Hoffman said. "I don't see the product having a viable future in the near term."

Musk has never shied away from moonshot projects. But even he has acknowledged that Optimus is harder to develop than Tesla's Model X, Cybertruck, or gigafactories. If Tesla pulls it off, Musk believes Optimus could usher in "sustainable abundance," a future in which AI and robotics make human labor largely optional.

Tesla did not repond to a request for comment from Business Insider

Here's everything we know about Optimus so far:

From human to humanoid

Musk introduced the "Tesla Bot" in 2021 with a person dancing in a robot costume.

Three years later, Optimus robots danced, served drinks, and spoke with guests at Tesla's "We, Robot" event. The robots walked on their own, but more complex movements, such as pouring drinks, handing out desserts, and interacting with attendees, were assisted by remote human operators.

Tesla hasn't yet revealed what the next version of Optimus will look like. All we know is that it stands nearly six feet tall and has a humanlike design, a form that one Silicon Valley investor dismissed to Business Insider as a "parlor trick". Musk has defended humanoids, arguing that robots must resemble people to perform the full range of human tasks.

Chinese companies, including Unitree and UBTech, accounted for about 90% of humanoid shipments last year, according to technology research firm Omdia. Musk has argued that Optimus will be much more sophisticated than its Chinese rivals, but has shared few details so far.

"Optimus is designed to have a lot of intelligence and to have the same electromechanical dexterity, if not higher, than a human," Musk said on a podcast earlier this year. "Unitree does not have that."

Where Optimus stands now

Even though Tesla has not publicly unveiled the next-generation Optimus, it released photos this week of the Fremont production line, where manufacturing is expected to begin soon. Musk previously said that Tesla was keeping the robot under wraps to prevent competitors from copying its design.

Tesla stopped producing the Model S and Model X in Fremont earlier this year to make room for an Optimus line designed to eventually produce a million robots a year. A second line under construction in Austin is planned to have an annual capacity of 10 million robots.

The first bots will join Tesla's "Optimus Academy," where they will practice tasks and generate data used to improve the AI models that serve as their "brains." Musk has said that 10,000 to 30,000 robots will refine their real-world skills at the academy.

On the company's earnings call this week, AI chief Ashok Elluswamy said that the training could push the robots' capabilities to a "superhuman level."

Musk cautioned investors this week that production will ramp slowly because there is no established supply chain for many Optimus components.

Tesla has three big problems to solve

To make Optimus a reality, Musk says Tesla must solve three problems: intelligence, hands, and mass production.

First, the robot must learn to understand and move through the physical world. Musk believes Tesla's self-driving work gives it a head start because Optimus can use Tesla-designed AI chips and technology developed to help its cars interpret camera footage.

Tesla has adapted its driving simulator, a virtual environment used to train and test its self-driving technology, to train millions of virtual robots. But simulations cannot capture every real-world scenario, so Tesla also needs data from physical tasks. Tesla employees have recorded themselves performing factory jobs, for instance.

Hoffman, the Cornell professor, said Musk is underestimating how much harder humanoid robotics is than self-driving.

"It's like playing checkers versus doing nuclear physics," he said. Humanoids must balance on two legs without falling, he added, and today's AI models are still far from operating reliably in the physical world.

The second challenge is what Musk calls the "hands problem": replicating the human hand with motors, sensors, and software. A robot hand must combine strength, precision, and flexibility in a remarkably small space, making it exceptionally difficult to engineer.

On Tesla's earnings call this week, Musk said Optimus is being designed to have "human and then superhuman dexterity." Achieving that has required Tesla to develop custom motors, gears, and sensors.

The final challenge is scaling up manufacturing. Musk has warned that early production will be "agonizingly slow." But once Tesla starts producing a million robots a year — the timeline for which is still unclear — he estimates each Optimus could cost about $20,000 to $25,000 to produce.

How Optimus fits into Musk's AI empire

Musk has increasingly talked about a "convergence" across his business empire, which is becoming more intertwined around AI.

Ahead of and during Tesla's earnings call this week, shareholders and analysts pressed Musk about a rumored merger with SpaceX. Musk wouldn't comment on the speculation, but highlighted the company's synergies, including the Robotaxi and AI businesses.

Musk has previously explained how Optimus could work with SpaceX's technology, which acquired xAI in February. Each robot would have enough computing power to perform some tasks independently, while xAI's Grok could coordinate larger groups, he said.

"Let's say you wanted to build a factory," Musk said earlier this year. "Grok could organize the Optimus robots, assign them tasks to build the factory floor to produce whatever you want."

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