Tesla is advancing production of its humanoid robot, Optimus, aiming for one million units annually by 2026. The Texas Gigafactory expansion will enable a larger production capacity of 10 million units annually starting in 2027.

Optimus is designed to handle repetitive tasks, signalling Tesla’s expansion into robotics. Early prototypes are in production at the Fremont factory, with Tesla aiming for a production cost of approximately $20,000 per unit.

Musk envisions Optimus transforming work by automating tedious tasks. The Optimus V3, expected to debut in 2026, is predicted to appear lifelike, requiring people to verify it is a robot.

Other tech companies are also advancing in robotics. NVIDIA aims to lead with upcoming innovations in 2025, while Advanced Micro Devices is exploring industrial robots with its Kria System-on-Modules.

Tesla stock has risen by 6% this year, though it trades at a forward price-to-sales ratio higher than the industry. Competitors like Boston Dynamics and Figure AI are developing similar technologies, presenting potential challenges for Tesla’s long-term success in the robotics field.

Given the current date of November 13, 2025, the narrative around Tesla is clearly shifting from a pure electric vehicle play to a long-term robotics and AI story. The stock’s 6% gain year-to-date, trailing the auto industry’s 12% growth, reflects the market’s concern over slowing EV demand, which we saw confirmed in the latest Q3 global auto sales report showing a mere 4% year-over-year increase. We see the Optimus project as Tesla’s attempt to justify its high valuation, which stands at a forward price-to-sales ratio well above its historical average.

In the coming weeks, we should watch for elevated implied volatility in Tesla options, especially for contracts expiring after the planned early 2026 Optimus V3 reveal. Currently, TSLA’s 90-day implied volatility is trading near 65%, significantly above the S&P 500’s VIX of 14, suggesting traders are pricing in a major move. This presents an opportunity for strategies like call debit spreads to bet on upside from positive news, or for selling premium via iron condors if we believe the stock will remain range-bound until the event.

The production targets of one million robots by late 2026 seem incredibly ambitious, especially when we recall the production delays experienced with the Model 3 and Cybertruck in the late 2010s and early 2020s. We should therefore consider any positive news about the Fremont pilot production line as a short-term bullish catalyst. A potential trade could involve calendar spreads on TSLA options, going long on later-dated contracts to capture the long-term potential while selling shorter-dated ones to capitalize on volatility decay.

This robotics arms race extends beyond just Tesla, creating plays in the semiconductor space. NVIDIA’s stock has continued its powerful run since the AI boom of 2023-2024, with its latest earnings beat driven by strong demand for its Jetson Thor chips. We could play this broader trend by looking at bull call spreads on NVDA, as it provides exposure to the entire robotics sector without the single-company execution risk tied to Tesla.

Finally, we must acknowledge the growing competition, as companies like Figure AI recently announced a major pilot program with a global logistics firm, proving they are making commercial inroads. This reinforces the idea that Tesla’s success is not guaranteed, even with its manufacturing expertise. This makes a pairs trade, such as going long a basket of robotics enablers like NVDA and AMD while holding a speculative put position on TSLA, a prudent way to hedge against potential Optimus delays.