Tesla and SpaceX are discussing a possible merger, Musk says

Elon Musk has stated that a merger between Tesla and SpaceX could be a "good idea," although he has cautioned that it is not a guarantee. Musk explained that special committees consisting of independent directors have been formed to discuss the potential merger at the request of shareholders. These committees consist of two groups and Musk is not a member of either committee, nor involved in any of the discussions due to his conflicted position.

The committees have not reached an agreement on the terms of any transaction, and there is no assurance that one will be reached. Musk emphasized that shareholders, particularly those on the Tesla side, would need to vote in favor of the merger, which would be a significant hurdle. He also noted that a Tesla-SpaceX merger would create a mega-entity valued upwards of $3.6 trillion, but combining the two companies would have tradeoffs.

Buying SpaceX would require Tesla to create millions of new stock shares, diluting current Tesla owners' holdings. Additionally, SpaceX's launch goals would require annual expenditures that could strain Tesla's ability to build new car factories and battery plants. Despite these considerations, most Wall Street analysts and legal experts believe that SpaceX would acquire Tesla rather than the other way around.

A merger in that direction would allow SpaceX shareholders to hold the majority control of the combined entity. Some Tesla shareholders may oppose the deal, but it could create a single company for those who believe in Musk's vision of the future, including robot cars, humanoid robots, AI super-intelligence, and human habitats on Mars.

Barclays suggested that a potential Tesla-SpaceX combination could be announced ahead of Tesla's annual shareholder meeting scheduled for December 3, 2026.