Space X and Tesla's merger: Elon Musk eyes a trillion dollar corporate deal to unite AI, cars, and space

Space X and Tesla's merger could create the largest corporate deal in history, bringing together rockets, satellite internet, artificial intelligence, electric vehicles and humanoid robots

SpaceX and Tesla's merger could reshape Elon Musk's business empire

SpaceX and Tesla's merger: Elon Musk eyes $3.5 trillion corporate deal

Updated on:

25 Oct 2026, 10:01 am

2 min read

According to Elon Musk, SpaceX and Tesla have developed committees to investigate the possibility of merging for about $3.5 trillion dollars. The SpaceX and Tesla's merger would enable the unification of rockets, satellite internet, artificial intelligence (AI), electric cars and robotics under the same corporation. Nonetheless, he has warned that the merger is not guaranteed, as it will need majority backing from all Tesla shareholders.

SpaceX and Tesla's merger: What both companies bring to the deal

SpaceX was started by Elon Musk in 2002 to make space travel cheaper in order to send people to Mars one day. It uses reusable rockets called Falcon 9, which dominate the rocket launch industry all over the world. The company's Dragon capsule carries NASA astronauts to the International Space Station. Its Starlink satellite network also provides internet services worldwide.

BREAKING: Elon Musk to merge Tesla and SpaceX in a $3.7 trillion mega-deal 70% chance it happens before 2028 https://t.co/K4fb1w1EmT
— Kalshi Finance (@Kalshi_Finance) October 24, 2026

SpaceX has outgrown the business of rockets and satellite communication. This month, it acquired xAI, which was an artificial intelligence firm run by Musk that has a famous chatbot called Grok. The company acquired X, a social media network, in 2025. SpaceX became publicly traded in 2026 and holds an estimated valuation of $2 trillion. Much of its recent growth has come from renting data-centre computing power to other AI companies.

Founded in 2003, Tesla became the most recognised maker of electric cars after Musk was appointed as its CEO in 2008. The company has an approximate valuation of $1.5 trillion. But its primary business of making cars faces challenges. Elon Musk is emphasising the development of self-driving robotaxis and Optimus, its humanoid robot.

Elon Musk on a possible SpaceX–Tesla merger: "Do I think it would be a good idea? Yes" Both SpaceX and Tesla have formed special committees of independent directors to discuss the idea, at the request of shareholders Because he's a conflicted party, Elon can't take part in those discussions "Some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it" "The special committees have not reached agreement on the terms of any transaction. And obviously there's no guarantee that they will" On the Tesla side, it would need a 50% vote of all shares, not just those who vote. That's a high hurdle So why does Elon support it? "I do think there's a lot of merit to combining the companies as we are pretty much in the super intelligence singularity" "There's a lot to be gained from cooperating on developing super intelligence software, chip design, the Terafab, obviously robotics, mass to orbit with the Starmind constellation. Connectivity" Next, the special committees of both companies have to agree on terms, and then it goes to a shareholder vote
— X Freeze (@XFreeze) October 20, 2026

According to Elon Musk, the SpaceX and Tesla's merger will be 'a good idea.' But there is a big approval problem with the merger of SpaceX and Tesla. It requires majority approval from all Tesla shareholders, which Elon Musk has said is 'quite a high hurdle.'

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