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Tesla’s deal with New York State is about to change dramatically

Tesla's Gigafactory New York. (Credit: Tesla)

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Tesla’s deal with New York State officials regarding the Gigafactory in Buffalo is about to change dramatically as the current agreement is set to expire this year.

The factory produces Tesla’s Solar Roof and Superchargers. There are also Autopilot data analysts employed at the factory.

Tesla currently has an agreement that requires an employment rate of 1,460 people at Gigafactory 2 and 2,000 total people across the state of New York. Not reaching these thresholds would invoke a $41 million fine.

However, in 2025, Tesla and the State will renew their deal, and the terms are set to change pretty dramatically.

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According to the Investigative Post, Tesla and the State have decided to rework the terms as a new draft agreement obtained through the Freedom of Information Act by Empire State Development.

The new deal includes the following changes:

  • The new agreement could run through 2034
  • Tesla will employ 1,800 employees in Buffalo, up from 1,460
  • Tesla will employ 3,000 employees statewide, up from 2,000
  • Penalties for not reaching the employment threshold will result in a $41 million penalty but will drop to $10 after 2029

There are also adjustments to the rent that Tesla pays for the factory, an agreement for the Dojo Supercomputer location, and the potential for an increase in the statewide employee threshold if lawmakers allow the company to open 10 showrooms across New York State.

  • Tesla currently pays $1 per year for rent. This number will go up to $2 million through 2029 and $5 million through 2034
  • The Dojo Supercomputer will be located at Gigafactory Buffalo
  • Tesla needs to hire 500 more employees statewide if 10 showrooms are allowed to open across New York State

Tesla investing over $500 million to build Dojo supercomputer in New York

Tesla would also need to invest to bring more job training programs to Buffalo.

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The agreement has reportedly not been signed quite yet.

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on X @KlenderJoey. If you're looking for great Tesla accessories, check out shop.teslarati.com

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Tesla removes Model S and X custom orders as sunset officially begins

In a significant development that marks the beginning of the end for two of its longest-running models, Tesla has removed the custom order configurator for the Model S sedan and Model X SUV from its website.

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Credit: Tesla

Tesla has officially started the “honorable discharge” of the Model S and Model X with a massive move, removing the two vehicles from Custom Orders and only offering inventory options.

It is the latest move Tesla has made to pull the Model S and Model X from its lineup, a decision CEO Elon Musk announced during its last quarterly earnings call.

Tesla brings closure to flagship ‘sentimental’ models, Musk confirms

In a significant development that marks the beginning of the end for two of its longest-running models, Tesla has removed the custom order configurator for the Model S sedan and Model X SUV from its website.

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As of April 1, visitors to tesla.com/model-s and tesla.com/modelx are now redirected exclusively to limited inventory listings rather than a design studio, allowing buyers to select paint, wheels, interior options, or performance upgrades. Only pre-built vehicles currently in stock are available for purchase or lease.

Tesla CEO Elon Musk confirmed the change directly on X, posting: “Custom orders of the Tesla Model S & X have come to an end. All that’s left are some in inventory.”

We will have an official ceremony to mark the end of an era.” Accompanying the statement was a throwback photo from the Model S production launch in 2012, underscoring the emotional weight of the decision.

Musk had first signaled the phase-out during the company’s Q4 2025 earnings call in January, describing it as time for an “honorable discharge” of the programs to free up resources at the Fremont factory for Optimus humanoid robot production and autonomous vehicle initiatives.

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The Model S, introduced in 2012, and the Model X, which followed in 2015, were instrumental in establishing Tesla as a premium electric vehicle leader.

The sedan offered class-leading range and acceleration, while the SUV’s signature falcon-wing doors became an iconic feature. Together, they proved EVs could compete in the luxury segment. Yet sales volumes have dwindled in recent years as Tesla prioritized higher-volume Model 3 and Model Y vehicles.

The flagships now represent a tiny fraction of overall deliveries, making continued custom production inefficient as the company accelerates toward robotaxis and next-generation platforms.

Prospective buyers are urged to act quickly. Remaining U.S. inventory vehicles—some nearly new—may include incentives such as lifetime free Supercharging, Full Self-Driving (Supervised) capability, and premium connectivity, depending on configuration.

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Leasing options start around $1,699 per month for select Model X units, though exact pricing and availability fluctuate. International markets, including Europe and China, have already seen similar restrictions in recent months.

The move aligns with Tesla’s broader strategy to streamline its lineup and redirect manufacturing capacity toward autonomy and AI-driven products. While some enthusiasts lament the loss of personalization, the company views the transition as necessary progress.

Tesla has indicated that once the current inventory sells out, new Model S and Model X vehicles will no longer be offered.

For loyal owners and fans, the promised “official ceremony” may provide a fitting send-off. In the meantime, the website change serves as a clear signal: the era of bespoke flagship Teslas has quietly concluded, and the focus has fully shifted to the future.

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Elon Musk

SpaceX files confidentially for IPO that will rewrite the record books

SpaceX files confidentially for a record-breaking IPO targeting a $1.75T valuation and $80B raise, driven by Starlink growth and its xAI merger.

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Elon Musk’s rocket and satellite company submitted its draft registration to the U.S. Securities and Exchange Commission today for an initial public offering, targeting June at a $1.75 trillion valuation. This would be the largest in history.

SpaceX has filed confidentially with the SEC, first reported by Bloomberg. SpaceX would be valued above every S&P 500 company except Nvidia, Apple, Alphabet, Microsoft, and Amazon.

The filing uses a confidential process that allows companies to work through SEC disclosures privately before initiating a public roadshow. With a June target, official details through a formal prospectus is expected to go public in April or early May, after which SpaceX must wait at least 15 days before beginning investor marketing.

SpaceX IPO is coming, CEO Elon Musk confirms

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While SpaceX is best known for its Falcon 9 and Starship rockets, the $1.75 trillion valuation is anchored by Starlink, its satellite internet service. Starlink ended 2025 with 9.2 million subscribers and over $10 billion in revenue, which is a figure analysts project could reach a staggering $24 billion by the end of 2026. A February all-stock merger with xAI, Musk’s artificial intelligence venture, further boosted the valuation.

SpaceX officially acquires xAI, merging rockets with AI expertise

Bank of America, Goldman Sachs, JPMorgan Chase, and Morgan Stanley are lined up as senior underwriters. SpaceX is also considering a dual-class share structure to preserve insider voting control, and plans to allocate up to 30% of shares to retail investors, which is roughly three times the typical norm.

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Elon Musk

Elon Musk hints at “official ceremony” with throwback photo to close Tesla Model S, Model X chapter

Elon Musk promises an official ceremony to mark the end of Tesla Model S and Model X production.

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lon Musk at the Tesla Model S production launch at the Fremont factory, June 2012. Photo shared by Musk on X, March 2026.

Tesla has officially begun winding down production of the Model S and Model X, sending farewell emails to U.S. customers on March 27 and updating the website to reflect the end of the line. Shoppers visiting Tesla.com now find only a limited set of Model S and Model X inventory units available for purchase, with no option to configure  a new factory build. The move formalizes what CEO Elon Musk announced on the company’s Q4 2025 earnings call in January, when he said it was “time to basically bring the Model S and X programs to an end with an honorable discharge.”

Musk posted on X a throwback photo of himself speaking at the Model S production launch in 2012, and noting “We will have an official ceremony to mark the ending of an era. I love those cars.”

The mention of an official ceremony is notable. Tesla has not held a formal farewell event for a vehicle before, and Musk’s wording suggests this will be something deliberate rather than a quiet line shutdown. Given that Musk’s X post shows a photo of him on stage with a microphone in front of an audience at the Fremont factory, it wouldn’t be too far-fetched to expect a closing ceremony to take place at the same location. Perhaps? Whether it becomes a public event, a private gathering for employees, or a livestreamed moment on X remains to be seen.

The Model S first went on sale nearly fifteen years ago and was Tesla’s first fully in-house designed vehicle, proving that an electric car could be fast, desirable, and capable of long distance on a single charge. The Model X followed in 2015, turning heads with its unmistakable and distinctive falcon-wing doors, while becoming one of the first all-electric SUVs on the market. Tesla’s two flagship vehicles would ultimately push legacy automakers to take all-electric transportation seriously and help fund development of the more affordable Model 3 and Model Y.

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By 2025, however, both models had been reduced to a rounding error in Tesla’s sales figures. Musk was direct about what comes next, stating “We are going to convert that production space to an Optimus factory. It’s part of our overall shift to an autonomous future.”

Elon Musk’s $10 Trillion robot: Inside Tesla’s push to mass produce Optimus

That shift is already underway. Tesla officially started Optimus Gen 3 production at its Fremont factory in January 2026, with the line targeting a run rate of one million units per year. The Gen 3 robot features 22 degrees of freedom per hand, runs on Tesla’s AI5 chip, and shares the same neural network architecture as Full Self-Driving. A dedicated Optimus factory at Gigafactory Texas is also under construction, with a planned annual capacity of 10 million units. The production lines that once built the Model S and Model X are being converted to support that ramp.

Tesla confirmed it will continue to support existing owners with service, software updates, and parts for as long as people own the vehicles. For buyers still interested in a new example, remaining U.S. inventory is discounted and the window is closing fast.

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