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Musk Reveals SpaceX and Tesla Exploring Merger Possibility
Confirmed
In Short: Elon Musk, the world’s richest man with a net worth of over $900 billion, revealed that SpaceX and Tesla are exploring a possible merger, a move that could create a corporate behemoth worth more than $3 trillion.
Elon Musk, the world’s richest man with a net worth of over $900 billion, revealed that SpaceX and Tesla are exploring a possible merger, a move that could create a corporate behemoth worth more than $3 trillion. Musk made the announcement during SpaceX’s third-quarter earnings call on Tuesday, noting that the idea is still speculative and faces significant hurdles.
According to Musk, the merger would need to clear a high hurdle: a 50 percent vote among Tesla shareholders. He emphasized that some people assume the merger is a certainty, but he believes that would be overstating the situation. Musk owns a roughly 20% stake in Tesla and 45% of SpaceX, wielding control over about 82% of the voting power at SpaceX.
At current valuations, SpaceX and Tesla rank as the world’s seventh- and eleventh-largest companies, respectively, with a combined market capitalization of about $3.5 trillion. SpaceX’s next-generation Starship spacecraft atop its Super Heavy booster was launched on its ninth test at the company’s launch pad in Starbase, Texas, on May 27, 2025.
Musk noted that the boards of both companies have formed special committees of independent directors to discuss the merger. These committees were created at the request of shareholders, according to Musk. Tesla has seven independent board members under Nasdaq’s listing standards, including board chair Robyn Denholm and former Tesla CTO JB Straubel.
Musk’s pledge to give every child in America one share of SpaceX would cost him roughly $10.5 billion at SpaceX’s last-traded share price of $146.03, covering about 72 million American minors. This pledge comes amid speculation about a potential SpaceX-Tesla merger.
Musk said that even answering questions about the merger from analysts felt like “dancing through a minefield.” He added that the core skills applicable across industry sectors could lead to synergistic innovation and significant information flows between businesses. Both firms have expertise in robotics, AI, and energy infrastructure.
According to Musk, SpaceX expects annual recurring revenue of $500 billion to $1 trillion by the end of 2027. Shares of SpaceX rose more than 8 percent in after-hours trading following Musk’s comments, while Tesla stock rose just over 1 percent.
Jerayr Haleblian, an expert in mergers and acquisitions at the University of California, Riverside, said a SpaceX-Tesla merger has “sound logic” to support it. Haleblian noted that both firms have expertise in robotics, AI, and energy infrastructure, and that the key to success would be synergistic innovation.
What this adds
The special committees consist of independent directors and were created at the request of shareholders. Musk emphasized that he cannot be part of the discussions due to his conflicted position as CEO of both companies.
What's confirmed
- Musk, the world’s richest man with a net worth of more than $900bn, said that a merger would need to clear the “high hurdle” of a 50 percent vote among Tesla shareholders “Some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it,” Musk said.
- Tech billionaire Elon Musk said Tuesday that the boards of SpaceX and Tesla had separately formed special committees to discuss the idea of a merger, taking a small step toward the possible consolidation of his two biggest companies.
- “It’s an odd Kabuki dance, where groups of people are talking and I can’t be in the conversation,” he said during the earnings calls.
What's still developing
- “This is definitely the kind of question where I feel like I’m tap dancing through a minefield.” Tesla stock rose just over 1% in after hours trading, while SpaceX rose above 5% following the Q&A with Wall Street analysts featuring Musk, SpaceX president and COO Gwynne Shotwell, and chief financial officer Bret Johnsen.
- In January, Tesla announced that it was investing about $2 billion to acquire shares in an AI startup that’s a subsidiary of SpaceX.
- He also said that even answering a question about the idea from an analyst felt like “dancing through a minefield.” “I do think there’s a lot of merit to combining the companies, as we are pretty much in the superintelligence singularity, and there’s a lot to be gained from cooperating,” he said.
- Gracias, who once sat on Tesla’s board, founded and leads Valor Equity Partners, which has a 3.4% stake in SpaceX.
- Musk called the merger “a good idea,” though he cautioned it wasn’t a guarantee.
- “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees,” Musk said.
- He has called its models "misanthropic and evil" and accused them of racial and demographic bias, tied in part to Anthropic's public-benefit structure and its 80% giving pledge from its founders.
- Tesla stock jumped 2.7% overnight and gave most of it back after the denial, leaving investors to decide who to believe. - tesla china spinoff rumors explained - elon musk tesla stock denial impact The pledge also arrives in the middle of real speculation about a Tesla-SpaceX combination.
- SpaceX President Gwynne Shotwell and her husband pledged to donate a share of SpaceX stock to the Trump Account of each of more than 2 million American children.