Elon Musk's $3.6 Trillion Gamble: Tesla and SpaceX Merger Could Reshape AI Landscape
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Rockets, robots and risk: Elon Musk's $3.6tn gamble to merge Tesla and SpaceX
The world's richest man attempts his most audacious deal yet. But shareholders and global regulators will need convincing The world's richest man is preparing for the "AI singularity" by trying to fold SpaceX and Tesla together into a single company spanning rockets, satellites, internet service,
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AI could drive a Tesla-SpaceX tie-up as soon as this fall, analysts say
The big picture: Musk's business empire is becoming increasingly interconnected, raising the prospect of a combination that would consolidate his control over two of the world's most valuable companies, while allowing both to move faster on big AI projects. Zoom in: The Barclays analysts, led by
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Barclays says Tesla-SpaceX merger could be announced before AGM
Analysts led by Dan Levy said the value lies in combining the companies' AI technology and that shareholder approval is the main hurdle Barclays analysts said a merger between Tesla $TSLA and SpaceX could be announced before Tesla's annual general meeting, which they expect to take place by Dec.
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How a SpaceX and Tesla Merger Would Reshape Musk's AI Empire
Both boards are now studying a tie-up that would put Grok, X, Starlink, orbital data centers, a chip megafactory and Optimus robots under one roof -- and under one man's control. In brief * Elon Musk said Tuesday that SpaceX and Tesla have each formed special committees of independent directors
[5]
Why Musk wants to merge Tesla and SpaceX before Trump leaves office
The world's richest man confirmed this week that Tesla and SpaceX are exploring a merger. Together, the companies are worth about $3.5 trillion (€3.1tn), making it potentially the biggest merger ever. It would cap a string of deals tying Elon Musk's businesses together, and the goal is to complete
[6]
Elon Musk signals Tesla and SpaceX could merge. Here's why he thinks it's a good idea.
Elon Musk on Tuesday said SpaceX and Tesla are exploring a merger -- a business combination that one Wall Street analyst said could be worth nearly $5 trillion, which would make it the largest deal in corporate history. "Both SpaceX and Tesla have formed special committees to discuss this idea at
[7]
Musk says backs SpaceX-Tesla merger as rocket firm turns profit
Washington (United States) (AFP) - Elon Musk said Tuesday he would back a merger of SpaceX and Tesla, as his rocket and AI company reported its first quarterly profit since going public, driven by deals to rent out computing power to AI firms. Asked about a possible tie-up on a call with analysts,
[8]
Elon Musk confirms Tesla-SpaceX merger talks
Musk said combining the companies could benefit artificial intelligence, chip development and robotics, although no agreement has been reached and a merger remains uncertain. SpaceX and Tesla have formed special committees to explore a possible merger at shareholders' request, Elon Musk said
[9]
Musk Backs Tesla-SpaceX Merger Idea as AI Revenue Soars
A merger would bring Tesla into the same corporate group as Grok developer SpaceXAI and social media platform X. Elon Musk said he likes the idea of merging Tesla with SpaceX in a potential move that would create a roughly $3.5 trillion technology giant combining AI, space exploration and electric
[10]
Elon Musk Says There's 'A Lot of Merit' to Tesla and SpaceX Merging. Here's What Wall Street Thinks
Elon Musk thinks there would be "a lot of merit" to merging with Tesla, fueling recent speculation about a tie-up. Musk, CEO of the company that combines AI, space exploration, and connectivity businesses, said during last night's SpaceX (SPCX) earnings call that the companies have "formed special
[11]
US Market: Musk backs Tesla-SpaceX merger idea, envisioning a $3.5 trillion giant
Elon Musk backs the idea of a Tesla-SpaceX merger that could create a technology conglomerate valued at around $3.5 trillion. The combination could unite electric vehicles, satellite communications, robotics and AI computing, while raising questions over regulation, governance and shareholder
[12]
Elon Musk says SpaceX-Tesla merger is 'a good idea'
STORY: Elon Musk gave his clearest signal yet that he's seriously considering combining his rocket company SpaceX with his car company Tesla, in a deal that would create one of the most valuable companies in the world worth around $3.5 trillion. This deal isn't so much about cars or rockets, it's
[13]
Why would Musk merge SpaceX and Tesla?
Oct 21 (Reuters) - Elon Musk believes a merger between Tesla and SpaceX is a good idea, he said on Tuesday, publicly backing an idea that would create one of the most valuable companies in the world, worth about $3.5 trillion. While electric-vehicle maker Tesla and rocket company SpaceX were once
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Elon Musk confirmed both Tesla and SpaceX have formed special committees to study a potential merger worth $3.6 trillion. The deal would unite rockets, robotaxis, humanoid robots, AI chip manufacturing, and orbital data centers under one company, with announcements potentially coming before Tesla's December 3 annual meeting.
Elon Musk Confirms Tesla and SpaceX Merger Talks
Elon Musk confirmed Tuesday that Tesla and SpaceX have each formed special committees of independent directors to study a potential merger between his two largest companies
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. The combined entity would be worth approximately $3.6 trillion at current prices, positioning it among the world's five most valuable companies alongside Nvidia, Apple, Alphabet, and Microsoft1
. Musk called the merger "a good idea" while acknowledging he must remain outside discussions as a "conflicted party" given his leadership roles at both companies1
. The Tesla and SpaceX merger would represent the biggest consolidation of Musk's AI empire to date, following xAI's absorption of X in March 2025 and SpaceX's acquisition of xAI in February4
.AI Singularity Drives Vertical Integration of AI Technologies
Musk justified the potential Tesla and SpaceX merger by citing the arrival of what he calls the "superintelligence singularity," arguing that AI has reached or is approaching the point where it surpasses human intelligence
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. He emphasized the benefits of combining efforts on "superintelligent software, chip design, the Terafab, obviously robotics, mass to orbit"1
. Barclays analysts led by Dan Levy identified AI as the central driver of a potential deal, noting that vertical integration of AI technologies would unite Tesla's physical robotaxis and Optimus humanoid robots with SpaceX's AI models and software2
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. The merged company would employ more than 155,000 people and generate combined revenue of $153 billion this year, according to analyst forecasts compiled by Visible Alpha1
.Terafab and Orbital Data Centers Power AI Infrastructure Plans
The Terafab AI chip manufacturing project stands as a key catalyst for the merger, with Barclays noting that separate board processes currently slow decision-making
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. Announced in March as a joint venture between Tesla and SpaceX, Terafab is a massive semiconductor manufacturing plant in Texas that could ultimately cost $119 billion and will produce chips for autonomous vehicles, humanoid robots, and orbital data centers1
. SpaceX expects to have about 3GW of computing power online by the end of this year and 13GW by the end of next year, with a "non-zero possibility" of exceeding 20GW1
. At slightly more than $50 per watt, 20GW would bring in about $1 trillion annually if fully rented, reaching the top of Musk's projected $500 billion to $1 trillion revenue run rate for end of 20271
. The most ambitious element is Starmind, SpaceX's plan to deploy AI data centers in orbit, with the company requesting U.S. regulatory approval for up to 1 million satellites4
.Barclays Predicts Announcement Before December Annual Meeting
Barclays analysts said a Tesla and SpaceX merger could be announced before Tesla's annual general meeting, expected to take place by December 6
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. The note warned that if the announcement were delayed into late October or early November, securing shareholder approval at the annual meeting could become increasingly difficult3
. In an alternative scenario, if a deal were announced later, analysts expect it within six to twelve months, aiming to close the transaction during the Trump administration with its relatively friendlier regulators2
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. The goal is to announce a merger deal in the first half of 2027 and complete it before President Trump's term ends in January 2029, according to Bloomberg citing people familiar with the matter5
.Shareholder Approval Presents Significant Hurdle
Barclays identified shareholder approval as the central obstacle, noting that both Tesla and SpaceX shareholders would likely need to vote in favor before any deal could proceed
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. Any deal needs the backing of 50% of all outstanding Tesla shares, which Musk called "quite a high hurdle"4
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. Barclays noted that broker non-votes, which are tallied against a proposal, represented roughly 11% of total outstanding votes at Tesla's 2025 annual meeting3
. The analysts consider a deal in which SpaceX buys Tesla entirely with its own equity the likeliest outcome, with Tesla holders receiving SpaceX stock3
. At market values of $2.1 trillion for SpaceX and $1.5 trillion for Tesla, that implies an exchange ratio near 0.7, though the note expects a premium for Tesla holders3
.Related Stories
Musk's Control and Existing Business Synergies
A merger would significantly tighten Musk's grip on the combined entity. Elon Musk controls about 84% of votes at SpaceX through super-voting shares, compared with roughly 20% at Tesla where each share carries one vote
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. Under the Barclays scenario, Elon Musk's stake in the merged entity would amount to roughly 37% ownership and 56% of voting power, depending on deal structure and valuations2
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. The companies already collaborate extensively, with SpaceX purchasing almost $1 billion of Megapack batteries and Cybertrucks from Tesla, including $131 million of trucks last year1
. Tesla became a SpaceX shareholder when its $2 billion investment in xAI converted into SpaceX stock after the two Musk companies merged1
. The companies jointly developed the Roadster "flying" sports car unveiled last week, which uses cold-gas thrusters developed by SpaceX, while Grok AI is provided free in many Tesla vehicles1
.Market Reaction and Analyst Predictions
Tesla stock spiked almost 4% after Musk's statements went public
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. Prediction markets show mixed confidence on timing, with Polymarket bettors putting odds of a merger before the end of December at 24%, while Kalshi bettors saw a 52% chance of one before May 20273
. Wedbush Securities analyst Dan Ives has put the odds of a Tesla and SpaceX merger closing in 2027 at between 80% and 90%3
. SpaceX President Gwynne Shotwell declined to rule out a future merger with Tesla on June 12, stating "There's no question that there are synergies between Tesla and SpaceX in our futures"3
. SpaceX reported third-quarter revenue of $14.58 billion, well above the $12.72 billion analysts expected, posting its first quarterly profit since going public by renting computing power of its AI server farms to firms such as Anthropic and Google4
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