Tesla to Cease Cybertruck Production in Texas for Cybercab

Tesla (TSLA) will halt Cybertruck production at Gigafactory Texas around mid-2027, Elon Musk wrote on X on Friday. The space will be taken over by Cybercab, a two-seater robotaxi currently undergoing federal review. "Tesla will halt Cybertruck production at Gigafactory Texas around the middle of next year to make room for increased Cybercab output," the post stated.

Whether this swap will benefit TSLA shareholders depends on the vehicle Tesla has yet to sell to private individuals. Shares fell 11% on Thursday even before the post was published.

Why Cybercab is under review

Cybertruck has been recalled more than once and its price repeatedly revised, as reported. Cybercab faces a different hurdle. Tesla began charging for rides in Austin on September 3, the day Cybercab launched. Within hours, the National Highway Traffic Safety Administration (NHTSA) opened an audit, Electrek reported.

The vehicle lacks permanently fixed steering, pedals, and mirrors. Tesla certified it as compliant with all applicable federal safety standards and did not request an exemption, the report stated. On September 10, NHTSA intensified the review with a special order—an official legal requirement for sworn responses. Incomplete answers could result in fines up to $139 million, Electrek reported.

What is known about capacity and finances

Tesla's presentation indicated an installed capacity in Texas of over 125,000 vehicles per year for each model—Cybertruck and Cybercab. However, installed capacity does not equal actual output.

Deliveries of other Tesla models in Q3 fell 48% year-over-year to 8,295; this group includes Cybertruck, Semi, Model S, and Model X, Electrek reported. Operating profit dropped 56% to $718 million, while research and development expenses rose 69%. This followed a profit miss in Q2.

Musk said on the quarterly earnings call that most Cybercabs will be owned by Tesla and offered as a ride service, CNBC reported. This structure could slow payback: revenue comes per ride, not from sales.

TSLA fell 11% on Thursday; Bloomberg linked this to a sell-off following midterm elections in companies associated with Musk. Year-to-date, shares have lost about 24%. Automotive business revenue in Q3 decreased 3% to $20.56 billion, CNBC reported. As a result, the swap ties Tesla's valuation more to autonomy than car sales. This conclusion will collapse if NHTSA restricts Cybercab deployment or volumes don't meet expectations.