By Abhirup Roy

SAN FRANCISCO Tesla Chief Executive Elon Musk on Wednesday set new targets for artificial intelligence products including self-driving software and using humanoid robots in factories, though he acknowledged he's been optimistic before.

The electric vehicle maker is in early talks with a major automaker to license its full self-driving technology, Musk added.

The value of Tesla vehicles would rise in perhaps "the single biggest step change in history" once regulators approved self-driving, he said at an earnings briefing. Musk has also said that Tesla robots, in pilot phase, could become a huge product. He said they could help out on Tesla's factory floors as soon as next year, although only about 10 have been built to date.

Rising interest rates and competition from new EV makers have forced Tesla to cut vehicle prices to gain market share, hurting margins.

But Musk said Tesla will keep pushing to expand sales volume at the cost of profit margins, betting on the long-term value from FSD. "Autonomy will make all of these numbers look silly," he said.

Tesla's move to license its technology comes after years of failed promises by many to create software that lets cars drive themselves.

The licensing announcement was not surprising, given industry failures, Ark Invest's Tasha Keeney said on Twitter. "Autonomy is hard, it requires vast amounts of data, and I believe many automakers will fail to achieve it on their own."

Tesla has completed over 300 million miles in the beta version of FSD, over half of which was in the past quarter, according to an earnings presentation.

But Musk was more cautious than usual.

"People have sort of made fun of me and perhaps quite fairly have made fun of me, my predictions about achieving full self-driving have been optimistic in the past," he said.

"I'm the boy who cried FSD, but I think we'll be better than human by the end of this year," he said. "I've been wrong in the past, I may be wrong this time."

(Reporting by Abhirup Roy in San Francisco; Editing by Peter Henderson and Sam Holmes)