Tesla’s Optimus Dreams Hit Roadblocks as AI Goes Human

Salesforce CEO Marc Benioff has publicly endorsed Tesla’s Optimus robot, calling it a “productivity game-changer” capable of tackling complex human work for a cost range of $200K–$500K [2]. The video, shared on X, showcased the next-generation Optimus model, featuring more human-like hands and integration with xAI’s Grok assistant, which allows the robot to understand and respond to verbal queries [2]. However, the demonstration highlighted the robot’s sluggish response time and limited functionality, as it struggled to perform a simple task—fetching a Coke from the kitchen—before the video ended without a resolution [2].

Elon Musk has consistently emphasized Optimus as a central pillar of Tesla’s future, claiming that approximately 80% of the company’s value will eventually come from the humanoid robot [1]. In a social media post, Musk reiterated his long-term vision, stating that Tesla’s Master Plan, Part IV, prioritizes the development of physical AI to achieve sustainable abundance [1]. The plan outlines a shift away from the electric vehicle market, where Tesla has seen declining sales, including a 13% global drop in the first half of 2025 [1]. The company’s strategic pivot is being framed as a broader mission to bring AI into the physical world, with Optimus as the primary vehicle for that transformation [1].

Despite Musk’s optimism, the Optimus project has faced significant production challenges. Early 2025 projections of manufacturing thousands of units were reportedly hindered by export restrictions on rare-earth materials caused by trade disputes between the U.S. and China [1]. Additionally, Milan Kovac, who previously led the Optimus development team, stepped down from his role in June, adding to the project’s growing difficulties [1]. The prototype stage remains active, with 2026 as the current production timeline [2]. While the demonstration video shows incremental progress, including improved hand design and Grok integration, the technology is still far from the mass-market deployment Musk envisions [2].

The humanoid robot sector is also intensifying in competition. Morgan Stanley estimates that the global market for humanoid robots could reach $5 trillion by 2050 [1]. Companies like Figure AI, backed by major investors including Jeff Bezos’s Bezos Expeditions and Microsoft, are rapidly advancing their own humanoid models. Meanwhile, Chinese industrial robot sales have nearly doubled since 2017, and open-source development in the region could provide a competitive edge in cost and scalability [1]. Tesla’s Optimus, despite its high profile, is now one of many projects vying for dominance in a sector that is expected to experience rapid growth over the next two decades [1].

In response to the growing competition, analysts have noted the challenges Tesla faces in scaling its Optimus production and maintaining its technological lead. Kevin Cook of Zacks Investment Research highlighted the presence of numerous startups and larger firms that are developing humanoid robots at lower costs, with some leveraging open-source platforms [1]. As Tesla moves forward, the company will need to demonstrate not only technical advancements but also a viable commercial model that justifies the high price point and extensive investment required for mass production [2]. The success of Optimus will likely depend on how quickly it can evolve from a prototype to a scalable, practical solution for industries seeking automation [1].

Source:

[1] Elon Musk says 80% of Tesla's value will come from ... (https://fortune.com/2025/09/02/elon-musk-optimus-robots-tesla-master-plan/)

[2] Tesla's Optimus robot with Grok shown on video. We're not ... (https://mashable.com/article/tesla-optimus-grok-robot-video)

[3] Tesla's next-gen Optimus prototype with Grok revealed (https://www.teslarati.com/tesla-next-gen-optimus-prototype-grok-revealed/)