Elon Musk told financial analysts during SpaceX’s quarterly results call on Tuesday that he is actively weighing a merger of his two flagship companies, Tesla and SpaceX. When asked if he believed a combination would be beneficial, Musk replied, “Do I think it would be a good idea? Yes.” He cautioned, however, that no certainty should be assumed and that any deal would ultimately need the backing of shareholders.
Merger talks confirmed
Musk said that both firms have set up special committees to explore the prospect. He noted that the committees have not yet reached agreement on any transaction terms and that there is no guarantee they will. Nonetheless, he emphasized that he sees “a lot of merit to merging and a lot to be gained.” The entrepreneur described himself as a “conflicted party” because he serves as chief executive of both companies, likening the discussion to “tap dancing through a minefield.”
Financial backdrop and market reaction
At the time of the comments, Tesla was valued at roughly $1.5 trillion, while SpaceX’s market worth stood at about $2 trillion, making a combined entity one of the largest mergers in history. Following Musk’s remarks, SpaceX shares jumped 8 % in after‑hours trading. The aerospace firm, best known for rockets and Starlink internet satellites, is expanding into cloud‑compute services for firms such as Anthropic and Google. That segment generated $7.5 billion in the latest quarter, becoming SpaceX’s most profitable line, while Starlink contributed $5.2 billion in revenue. Despite these gains, SpaceX remains unprofitable overall, reporting a $1.1 billion loss for the year to date.
Tesla’s stock also responded, rising 2 % after a period of slight decline. The electric‑vehicle maker is scheduled to release its own quarterly results on Wednesday.
Strategic rationale and hurdles
Musk highlighted several areas where a merger could create synergies, including chip manufacturing, artificial intelligence, and software development. He referenced the recent launch of “Terafab,” a joint effort between Tesla and SpaceX to produce computer chips, as evidence that the companies can operate more effectively together. The entrepreneur also pointed to SpaceX’s growing focus on AI infrastructure as a complement to Tesla’s existing technology stack.
Shareholder approval remains a significant obstacle. Musk said at least 50 % of Tesla’s shareholders would need to vote in favor of a merger, describing that threshold as “quite a high hurdle to achieve.” He added that the special committees have yet to agree on any terms, underscoring the early stage of the discussion.
In recent months, Musk has been consolidating his various enterprises under fewer umbrellas. Earlier this year, SpaceX acquired xAI and X (formerly Twitter), both previously owned by Musk. The latest merger talk continues that pattern, suggesting a strategic push to align his automotive, aerospace, and emerging AI businesses.
While the prospect of a Tesla‑SpaceX combination generates considerable market interest, the path forward will depend on detailed negotiations, regulatory clearance, and the willingness of investors to endorse a deal that could reshape two of the world’s most valuable technology firms.
Helene Elliott is the Lead Science & Space Reporter at News Raise. She reports on aerospace missions, astrophysics discoveries, quantum research, and environmental technology.
