Musk: Tesla Will Be the First to Build Robots With AGI

Elon Musk made a prediction on X about the race toward Artificial General Intelligence (AGI).

"Tesla will be one of the companies to make AGI and probably the first to make it in humanoid/atom-shaping form," Musk said.

This framing suggests that while xAI — Musk’s artificial intelligence startup, which was recently acquired by SpaceX — may focus on populating space with a massive network of over a million AI satellites, Tesla is where real-world intelligence is being developed.

Tesla will be one of the companies to make AGI and probably the first to make it in humanoid/atom-shaping form

— Elon Musk (@elonmusk) March 4, 2026

Tesla’s AI Foundations: FSD and Custom Silicon

Tesla has spent years building the infrastructure for AGI through its Full Self-Driving (Supervised) program. Unlike AI companies that center on large language models, Tesla’s systems are built to perceive and act in the physical world. That requires massive amounts of video data and specialized, highly scalable AI chips that Tesla designs in-house.

By training vehicles to “see” and make decisions in complex traffic, the company is effectively constructing a digital brain that understands physical laws. This real-world AI serves as a building block for AGI, moving beyond text processing to influence the world directly.

The Rise of Optimus: From Factory to Home

The flagship application of this capability is Optimus, Tesla’s humanoid robot. The company is moving quickly, recently discontinuing the Model S and Model X to clear space at its Fremont factory for Optimus Gen 3 production lines.

The planned milestones include:

• Q1 2026: The official unveiling of the Optimus Gen 3 production-intent prototype.
• Mid 2026: Launch of low-volume production for internal use within Tesla factories.
• Late 2026: The start of high-volume production lines, with a long-term goal of hitting 1 million units annually.

Over time, Tesla aims for a $20,000 price target for the robot at scale, enabling both industrial and home use. Optimus Gen 3 is planned for production in Fremont, while the more advanced Gen 4 is slated for Gigafactory Texas.

A Tesla-SpaceX Merger?

With xAI now under SpaceX to build data centers in space, and Tesla focused on AGI and robotics, some experts view a merger between the two companies as increasingly likely. Merging SpaceX’s orbital AI compute with Tesla’s humanoid “atom-shaping” form would create a technology group unlike anything seen before.

Tesla is no longer just a car maker; it has become an AI and robotics company. As the Gen 3 reveal approaches later this quarter, the boundary between science fiction and reality continues to narrow.