Elon Musk’s SpaceX and Tesla could announce a merger as soon as December, in what would be the biggest deal on record.
Tesla shareholders would receive SpaceX shares, folding the carmaker into the rocket, satellite, and AI company. Bloomberg reported on Thursday, 12 November, citing people familiar with the matter. Boards and advisers are now “hammering out the terms of the tie-up and governance structure of the combined entity”. Neither company had immediately responded to requests for comment, according to The Information, which relayed the Bloomberg report.
The timing could still slip. Bloomberg says the companies have also discussed an announcement in early 2027. Bloomberg had earlier reported that they were pushing for a deal by the first half of 2027. Their aim was to close before the end of President Donald Trump’s term, so December would pull that schedule forward by months.
What the deal would combine
SpaceX has been worth more than $1.9 trillion since its June IPO, and Tesla is worth about $1.5 trillion. CoinDesk puts their combined stock-market value at about $3.4 trillion.
The two already work together. They have a joint effort to build a semiconductor plant in Texas called Terafab, the subject of Musk’s recent talks with TSMC. The next-generation Tesla Roadster uses cold gas thrusters built on SpaceX hardware, and it turned up on display at SpaceX headquarters last month.
The key terms remain unclear. Tesla and SpaceX haven’t said what an exchange ratio, a combined board, or a listing would look like. Teslarati says one open item is how many SpaceX shares Tesla investors would receive. That number depends on the SpaceX share price. Barron’s says SpaceX shares have fallen about 13% since 21 October, while Tesla’s have stayed roughly flat. At a SpaceX price of $200 a share, a hypothetical deal with a 15% premium would have required about 2.3 SpaceX shares per Tesla share. At around $140, it rises to about 3.2, by Barron’s calculations.
Bloomberg says Tesla shares rose as much as 1.9% to a session high on Thursday, while SpaceX gained 0.5%.
What it means for Tesla, xAI, and Starlink
Musk owns about 20% of Tesla but controls roughly 85% of SpaceX’s voting power through super-voting shares, according to Electrek, citing SpaceX’s S-1 filing. Piper Sandler’s Potter thinks it’s “likelier than not” that a merger will be proposed, and that “in most scenarios, Musk would have >70% voting control of any new entity”. Bank of America expects SpaceX to buy Tesla with stock; at a 20% premium, Tesla holders would own about 47% of the combined company.
The bigger shift is in AI. SpaceX merged with Musk’s AI company xAI. In August, as SpaceXAI, it closed its $60 billion Cursor deal. A Tesla merger would bring Tesla’s driverless-car and humanoid-robot work under the same roof. Bloomberg says the rationale is a shared ambition to use artificial intelligence across space, driverless cars and humanoid robots. SpaceX has also become a supplier of AI infrastructure to companies including Anthropic.
Not every analyst is convinced. William Blair says, “We are hard-pressed to find a material opportunity that could only be achieved by an official combination.” Barclays said in October that the true value would lie in vertically integrating the two companies’ AI technology.
Starlink would also come along, as SpaceX is a top provider of internet beamed from space. SpaceX is buying low-band spectrum to take Starlink Mobile beyond satellite texting, and in the UAE, Starlink’s residential plans start at Dhs 230 a month.
The obstacles
According to Bloomberg, the companies will have to work out how to ring-fence Tesla’s operations in China. Electrek reports that Tesla builds about half its cars there, and that Giga Shanghai shipped 67,829 vehicles in October alone. Bloomberg’s sources also flag SpaceX’s US government and defence contracts. JPMorgan analyst Rajat Gupta described the two businesses’ “key dynamics that are at odds with each other”.
Democrats, who took control of Congress in the midterms, have pledged to probe Musk’s business and political dealings. Board ties will also draw attention: Ira Ehrenpreis chairs Tesla’s compensation and governance committees and has sat on SpaceX’s board since February.
Musk himself is at arm’s length, at least formally. On 20 October, he said on SpaceX’s third-quarter earnings call that both companies had formed special committees of independent directors to study a merger. He called the process “an odd kabuki dance”, described himself as “a conflicted party”, and recused himself from the decision. On the same call, he said a merger would be “a good idea”, but warned against reading too much into it.
Some people out there assume that a SpaceX and Tesla merger is a certainty… I think that would be overstating it
Elon Musk, on SpaceX’s earnings call
What happens next
Tesla’s shareholders hold the last word, and the bar is high. Tesla’s charter requires a majority of all outstanding shares, so abstentions and unvoted shares count against a deal. In 2025, a board declassification proposal won only 39.4% support against that same bar.
Tesla’s annual meeting at Giga Texas on 3 December has only three items on its ballot, led by the re-election of Musk, board chair Robyn Denholm, and JB Straubel. None is a merger proposal, so any deal announced in December would likely require a separate special meeting for Tesla shareholders to vote on it.
