Elon Musk Discusses Potential Tesla-SpaceX Merger with Special Committees

Elon Musk said that he is actively considering a merger between Tesla and SpaceX, a potential combination that would forge a $3.5 trillion corporate giant, bbc.com reported. Speaking during a financial analyst call to review SpaceX’s latest quarterly performance, the chief executive confirmed that special committees have been established within both entities to investigate the transaction.

SpaceX Could Buy Tesla in All-Stock Transaction

With Tesla valued at roughly $1.5 trillion and SpaceX commanding a $2 trillion valuation, joining the two operations would create one of the largest corporate mergers in history. Barclays analyst Dan Levy told clients in a note that a tie-up has increasingly become the consensus expectation, pointing to media reports and Musk’s own public hints, Yahoo Finance reported. Levy noted that SpaceX would likely act as the buyer in an all-stock transaction. At current market values, that structure would leave Musk controlling roughly 56% of the vote in the combined entity.

The strategic push toward consolidation centers heavily on artificial intelligence and advanced manufacturing. Musk pointed to the recent launch of Terafab—a joint manufacturing initiative for computer chips shared between Tesla and SpaceX—as evidence that his companies operate more effectively in tandem. A full merger would streamline chip design, software development, and artificial intelligence efforts across robotics and space systems.

Musk Faces Governance Hurdles in Merger Talks

Because he runs both organizations, Musk stressed that he is excluded from the internal committee discussions. This is definitely the kind of question where I feel like I’m tap dancing through a minefield, Musk said on the call, as reported by Fortune. He added that the special committees have not reached agreement on terms of any transaction and there's no guarantee that they will, but maintained that there is a lot of merit to merging and a lot to be gained.

Governance structures at both firms present unique challenges. SpaceX operates under a controlled company structure featuring super-voting Class B shares that carry 10 votes apiece, allowing Musk to control roughly 82% of its voting power despite owning about 45% of the equity, according to Fortune. Meanwhile, any deal requires approval from at least 50% of all outstanding Tesla shares—a threshold Musk characterized as quite a high hurdle to achieve.

SpaceX Revenues Surge as Shares Climb

The merger discussions coincide with surging financial metrics at SpaceX. For the third quarter ending September 30, SpaceX reported total revenues jumping to $27 billion over the first nine months of the year, alongside a $4.4 billion profit for the most recent quarter, offsetting earlier losses. Starlink brought in $5.2 billion during the three-month period, up from $3 billion the previous year, while cloud compute capacity expansion generated $7.5 billion.

Market reaction was swift following the announcement. SpaceX shares climbed 8% in after-hours trading, while Tesla stock ticked up 2%. Securities and Exchange Commission rules, Tesla must hold its annual general meeting by December 6, providing a potential avenue for a formal shareholder vote if terms are finalized in time.