Elon Musk said Tesla will begin launching unsupervised self-driving models in Austin, Texas, by June and several other U.S. cities by the end of the year.

At the fourth quarter earnings call Wednesday, the Tesla CEO and other executives also shared insight into the production of its Optimus humanoid robots and a more affordable vehicle model.

The meeting marks one of Musk's first public appearances since presuming his new U.S. role as head of the Department of Government Efficiency (DOGE) following President Donald Trump's inauguration.

Musk said the company plans to launch thousands of driverless vehicles as a robotaxi service throughout the city where its headquarters is located. Similarly to Airbnb, Musk said owners will have the option to add their Tesla vehicle to the robotaxi fleet when they are out of town by 2026.

"These Teslas will be in the wild with no one in them in June," Musk said. "This is not some far off mythical situation. It's literally five, six months away."

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However, he has made this same promise for many years now with no robotaxis yet in circulation. He did not provide details on how the paid service would work.

Musk later said the company eventually aims for unsupervised self-driving to allow Tesla vehicle owners to focus on their phone instead of the road when the technology can safely allow that. He added these vehicles are already self-driving autonomously at the Tesla factory in Fremont, California.

"We just need, we need to be very confident that the probability of injury is low before we are able to allow people to check their email and text messages," he said.

Prior to Wednesday, analysts have cited the company's advanced Full Self-Driving (FSD) software as a major contributor to its higher-than-expected profit margin in the third quarter, Reuters reported.

Musk also did not give new details on his affordable vehicle plans, including their pricing, size and specifications.

Tesla is trying to make cars for less, and it said the average cost of materials and labor for building its cars had hit its lowest level ever in the fourth quarter, driven by lower raw material costs. Reuters calculations showed the cost of making Teslas had fallen to about $33,000 from nearly $39,000 two years earlier.

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Tesla has a history of delivering products late and the company's recommitment to delivering the new vehicles in the first half of the year was positive, said Thomas Martin, senior portfolio manager at Tesla shareholder Globalt Investments, who was also encouraged by its reduced costs.

"They've been able to execute on the cost side and get that down. Their ability to do that in the fourth quarter definitely cushioned the blow," he added.

Tesla last year abandoned plans to build a cheaper vehicle platform for the mass market, often called the Model 2, Reuters reported in April. Instead, Musk said the company will use its current electric vehicle platform and production lines to produce more affordable models this year.

"People are reading into the results that FSD and robotaxi are potentially on the cards in the next couple of years," said Will Rhind, CEO of global ETF issuer GraniteShares. Musk, however, said that computers in some older Teslas would have to be upgraded for full self-driving.

Tesla has used cheap financing to pump up EV demand, a strategy analysts had predicted would erode automotive profit margins in future quarters as the company absorbs the impact of high interest rates.

How did Tesla do in the fourth quarter?

Tesla's fourth-quarter profit margin from vehicle sales, excluding regulatory credits, fell to 13.59% from 17.05% in the prior three-month period, according to Reuters calculations. Wall Street had expected the figure to be 16.2%, according to 23 analysts polled by Visible Alpha.

Revenue was $25.71 billion for the October-December quarter, compared with estimates of $27.27 billion, according to estimates compiled by LSEG. Adjusted earnings per share stood at 73 cents, below the 76 cents analysts had estimated.

The EV pioneer's annual deliveries dropped for the first time last year, due to higher borrowing costs and intense competition. Rivals such as China's BYD as well as European manufacturers BMW and Volkswagen have launched new cheaper models.

Tesla said it expected the vehicle business to return to growth this year, after a small drop in 2024. Musk had said late last year he expected vehicle sales to grow 20% to 30% in 2025, a forecast the company did not repeat in its results announcement.

Trump has vowed to impose this year a range of tariffs on imports from Mexico, Canada, Europe and other U.S. trading partners − a move that could disrupt supply chains and raise costs for automakers such as Tesla. Tesla CFO Vaibhav Taneja said tariffs, if imposed, would affect Tesla's business and profitability as it still relies on overseas suppliers.

Tesla shares were up about 4% Wednesday in after-hours trading after the company softened analyst projections for 2025 vehicle sales growth.

Tesla aims to create thousands of robots by year's end

Tesla aims to exponentially speed the production of its Optimus humanoid robots within the next few years, including creating thousands in 2025, according to Musk.

The SpaceX CEO said the Optimus robots, which were the central focus of Wednesday's meeting, will be far more useful than its cars. The robots will offer humans assistance from a broad range of tasks from playing the piano to threading a needle.

Musk said he expects the robots to eventually exceed Tesla vehicles as the company's primary revenue, but clarified the exact timing for this process remains uncertain. He compared the creation process to designing a moving train while simultaneously developing the tracks and the station it's heading to.

"It doesn't take very many years before we're making 100 million of these things a year," Musk said. "This is such an exponential ramp that it'll go from 'no one's receiving humanoid robots' to 'these things are coming out like crazy, we can't build enough.'"

Affordable model, AI development, more

Tesla also plans to launch a more affordable model in the first half of 2025, according to Chief Financial Officer Vaibhav Taneja.

Another key success driver is AI development, which Musk said will make 2025 the most significant year in Tesla's history.

"There is no company in the world that is as good at real world AI as Tesla. I don't even know who's in second place," Musk said. "I would need a very big telescope to see them. That's how far behind they are."

He also credited Tesla's energy business as a vital revenue driver, adding that energy storage "enables far greater energy output to the grid than is currently possible."

This story was updated to add new information.

Contributing: Reuters