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The next product race may not be fought on the highway. If Tesla and Space X CEO Elon Musk is right, it will play out on factory floors, in warehouses and eventually inside homes, where humanoid robots could become as common as smartphones.

Speaking during Tesla’s (NASDAQ:TSLA) January earnings call, Musk said the company’s future is increasingly tied to Optimus, humanoid robot program, arguing the project could one day eclipse every product that has come before it.

Bigger Than Every Product Before It

Musk left little doubt about the scale of his ambitions.

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“My prediction is that Optimus will be the biggest product of all time by far,” Musk said on the call. “Nothing will even be close. I think it’ll be ten times bigger than the next biggest product ever made. That level.”

Tesla is already reshaping its manufacturing plans around that vision. The company is winding down production of its flagship Model S and Model X vehicles and converting dedicated factory space at its Fremont, California, factory into an Optimus production line.

While Musk has described the project as remaining in the research and development stage, Tesla has said Gen 3 robots are already being tested internally, with plans to significantly ramp production during the year. 

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China Looms as the Biggest Challenge

Even as Musk predicted an enormous market for humanoid robots, he acknowledged Tesla is unlikely to dominate it alone.

“I think China will be by far the biggest competitor in the humanoid robot market,” Musk said on the earnings call. “China is extremely good at scaling and manufacturing, and is also strong in AI — the models being released there are already quite good and are improving rapidly.”

He added that, based on Tesla’s current view of the market, Chinese companies represent the automaker’s most formidable rivals.

“China’s very good at AI, very good at manufacturing, and will definitely be the toughest competition for Tesla,” Musk said. “To the best of our knowledge, we don’t see any significant competitors outside of China, but China will definitely be tough competition, there’s no two ways about it.”

Story Continues

Musk also suggested that people outside China often underestimate the country’s capabilities, calling it “an ass kicker next level.” Even so, he said Tesla believes it can maintain an advantage in areas such as real-world AI and robotic hand dexterity, which he described as one of the hardest engineering challenges in robotics.

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More Than an Auto Company

Musk has made ambitious predictions before, and they’ve often sparked as much debate as excitement. Whether every milestone arrives on his preferred timeline is another question. What’s harder to ignore is where Tesla is placing its biggest bets.

As the company pours more resources into Optimus, investors aren’t just watching automakers anymore. They’re also paying closer attention to businesses building the AI ecosystem—from computing infrastructure to robotics hardware—that could support the next wave of automation. Early-stage companies such as BluSky AI are among those seeking to capitalize on that demand, offering another way to gain exposure to the AI buildout.

For Musk, the message was unmistakable: the company’s next defining product may not be the vehicle sitting in the driveway, but the robot walking out the front door.

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This article Elon Musk Says Tesla Robot Will Be ‘Biggest Product of All Time’ — ‘Nothing Will Even Be Close’ but China Is Toughest Rival, ‘No Two Ways About It’ originally appeared on Benzinga.com

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