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Tesla to Wind Down Cybertruck: Can Cybercab Justify the Shift?
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Key Takeaways
Tesla plans to end Cybertruck production by fall 2027 amid weak demand and underutilized factory capacity.
Cybertruck's U.S. sales fell 48% to 20,237 units in 2025, far below Musk's annual target of 250,000 units.
Cybercab offers recurring revenue potential, but Tesla must prove driverless rides can be profitable at scale.
Tesla (TSLA - Free Report) is making room for a different future at its Gigafactory Texas plant. The company is expected to bring Cybertruck production to a close in fall 2027, with the factory space eventually being used to build Cybercab, its driverless vehicle. The move comes as the electric pickup struggled to attract mass-market buyers and fell short of the sales volumes Elon Musk once envisioned.
This is not simply a decision to stop making an underperforming model. It reflects Tesla's growing preference for autonomy and robotics over some parts of its traditional vehicle business. The bigger question is whether these newer ambitions can generate enough business for the company.
Cybertruck Struggles to Meet Its Sales Ambitions
When Tesla unveiled the Cybertruck, Musk set an ambitious target of selling 250,000 units annually. Its unconventional design attracted plenty of attention, but the initial excitement did not translate into sustained demand.
Per CNBC, Cox Automotive estimated that Tesla sold just 20,237 Cybertrucks in the United States in 2025, down 48% from 38,965 in 2024. Several recalls have added to the model's challenges, while its high price has limited its appeal to a wider pool of buyers.
Production capacity further highlights the mismatch. Tesla had installed capacity to produce more than 125,000 Cybertrucks annually, but the vehicle was selling at a pace of roughly 30,000 units a year before the wind-down announcement last Friday. That leaves considerable manufacturing capacity underutilized.
Tesla has now stopped accepting orders for the Premium AWD version, leaving the Cyberbeast as the only available configuration. Its price has increased by $7,500 to $109,990. Buyers placing orders now are being given delivery estimates between March and June 2027. Musk has said production will continue until the end of summer 2027 to work through the remaining backlog.
An interesting part of the sales story is SpaceX (SPCX - Free Report) . Musk's aerospace, communications and AI company purchased $131 million worth of Cybertrucks last year at Tesla's suggested retail price, according to a SpaceX financial filing. While these purchases contributed to demand, they also raise questions about how much of the Cybertruck's sales momentum came from buyers outside the broader retail market.
Tesla is not alone in discovering how difficult it is to make electric pickups profitable. Ford (F - Free Report) , which operates in the highly profitable U.S. pickup market, has also struggled to make its electric F-150 Lightning commercially viable and has decided to discontinue the model. Ford continues to report losses in its EV business but is working on a more affordable electric pickup. This highlights the difficulty of building a profitable electric truck business, even for established automakers with strong pickup franchises.
Cybercab and Optimus Become Tesla's Priorities
The factory space freed up by the Cybertruck's departure is expected to support Cybercab manufacturing. Cybercab is designed as a two-seat, fully autonomous vehicle without a steering wheel or pedals.
Musk sees Cybercab as central to Tesla's transportation-as-a-service strategy, in which autonomous vehicles could generate revenues by providing paid rides rather than relying solely on individual vehicle sales. If successful, this model could create recurring revenue opportunities and change how Tesla generates returns from its vehicle fleet.
But the economics are still a big question mark. Tesla must show that its technology can handle driverless operations reliably, win the necessary regulatory permissions and attract enough customers to support a commercially viable service. Manufacturing Cybercab at scale will matter only if the company can put those vehicles to productive use and earn attractive returns from them.
Tesla's focus on robotics is also increasing. The company has repurposed the Model S and Model X production lines at its Fremont factory to scale production of Optimus, its humanoid robot. Tesla ended Model S and Model X production in spring, citing its growing focus on autonomy. The Cybertruck wind-down further reinforces this strategic shift away from some of its existing vehicle programs.
Final Thoughts
Tesla's decision to wind down Cybertruck production makes sense given the truck's weak sales, underutilized capacity and limited progress toward its original volume ambitions. Cybercab has the potential to open up a new market for Tesla, but the company is yet to prove that its autonomous ride-hailing model can work at scale. Optimus is an even longer-term opportunity, with commercial returns still to be demonstrated.
Cybercab may eventually make the shift worthwhile, but until Tesla proves that driverless rides can become a profitable business, the opportunity remains more promise than payoff.
The Zacks Rundown on Tesla
Shares of Tesla have gained 15% over the past three months compared with the industry’s growth of 8%.
Image Source: Zacks Investment Research
From a valuation standpoint, TSLA trades at a forward price-to-sales ratio of 13.13, way above the industry. It carries a Value Score of F.
Image Source: Zacks Investment Research
See how the Zacks Consensus Estimate for TSLA’s earnings has been revised over the past 60 days.
Image Source: Zacks Investment Research
Tesla stock currently carries a Zacks Rank #3 (Hold).
View the Zacks #1 Rank List
Image: Shutterstock
Tesla to Wind Down Cybertruck: Can Cybercab Justify the Shift?
Key Takeaways
Tesla (TSLA - Free Report) is making room for a different future at its Gigafactory Texas plant. The company is expected to bring Cybertruck production to a close in fall 2027, with the factory space eventually being used to build Cybercab, its driverless vehicle. The move comes as the electric pickup struggled to attract mass-market buyers and fell short of the sales volumes Elon Musk once envisioned.
This is not simply a decision to stop making an underperforming model. It reflects Tesla's growing preference for autonomy and robotics over some parts of its traditional vehicle business. The bigger question is whether these newer ambitions can generate enough business for the company.
Cybertruck Struggles to Meet Its Sales Ambitions
When Tesla unveiled the Cybertruck, Musk set an ambitious target of selling 250,000 units annually. Its unconventional design attracted plenty of attention, but the initial excitement did not translate into sustained demand.
Per CNBC, Cox Automotive estimated that Tesla sold just 20,237 Cybertrucks in the United States in 2025, down 48% from 38,965 in 2024. Several recalls have added to the model's challenges, while its high price has limited its appeal to a wider pool of buyers.
Production capacity further highlights the mismatch. Tesla had installed capacity to produce more than 125,000 Cybertrucks annually, but the vehicle was selling at a pace of roughly 30,000 units a year before the wind-down announcement last Friday. That leaves considerable manufacturing capacity underutilized.
Tesla has now stopped accepting orders for the Premium AWD version, leaving the Cyberbeast as the only available configuration. Its price has increased by $7,500 to $109,990. Buyers placing orders now are being given delivery estimates between March and June 2027. Musk has said production will continue until the end of summer 2027 to work through the remaining backlog.
An interesting part of the sales story is SpaceX (SPCX - Free Report) . Musk's aerospace, communications and AI company purchased $131 million worth of Cybertrucks last year at Tesla's suggested retail price, according to a SpaceX financial filing. While these purchases contributed to demand, they also raise questions about how much of the Cybertruck's sales momentum came from buyers outside the broader retail market.
Tesla is not alone in discovering how difficult it is to make electric pickups profitable. Ford (F - Free Report) , which operates in the highly profitable U.S. pickup market, has also struggled to make its electric F-150 Lightning commercially viable and has decided to discontinue the model. Ford continues to report losses in its EV business but is working on a more affordable electric pickup. This highlights the difficulty of building a profitable electric truck business, even for established automakers with strong pickup franchises.
Cybercab and Optimus Become Tesla's Priorities
The factory space freed up by the Cybertruck's departure is expected to support Cybercab manufacturing. Cybercab is designed as a two-seat, fully autonomous vehicle without a steering wheel or pedals.
Musk sees Cybercab as central to Tesla's transportation-as-a-service strategy, in which autonomous vehicles could generate revenues by providing paid rides rather than relying solely on individual vehicle sales. If successful, this model could create recurring revenue opportunities and change how Tesla generates returns from its vehicle fleet.
But the economics are still a big question mark. Tesla must show that its technology can handle driverless operations reliably, win the necessary regulatory permissions and attract enough customers to support a commercially viable service. Manufacturing Cybercab at scale will matter only if the company can put those vehicles to productive use and earn attractive returns from them.
Tesla's focus on robotics is also increasing. The company has repurposed the Model S and Model X production lines at its Fremont factory to scale production of Optimus, its humanoid robot. Tesla ended Model S and Model X production in spring, citing its growing focus on autonomy. The Cybertruck wind-down further reinforces this strategic shift away from some of its existing vehicle programs.
Final Thoughts
Tesla's decision to wind down Cybertruck production makes sense given the truck's weak sales, underutilized capacity and limited progress toward its original volume ambitions. Cybercab has the potential to open up a new market for Tesla, but the company is yet to prove that its autonomous ride-hailing model can work at scale. Optimus is an even longer-term opportunity, with commercial returns still to be demonstrated.
Cybercab may eventually make the shift worthwhile, but until Tesla proves that driverless rides can become a profitable business, the opportunity remains more promise than payoff.
The Zacks Rundown on Tesla
Shares of Tesla have gained 15% over the past three months compared with the industry’s growth of 8%.
From a valuation standpoint, TSLA trades at a forward price-to-sales ratio of 13.13, way above the industry. It carries a Value Score of F.
See how the Zacks Consensus Estimate for TSLA’s earnings has been revised over the past 60 days.
Tesla stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here