Tesla and SpaceX have established special committees of independent directors to examine a potential merger, Elon Musk disclosed during SpaceX's October 20 earnings call. Formed at shareholders' request, the committees exclude Musk because his leadership and ownership interests in both companies create a conflict of interest. Although he endorsed a combination, he emphasized that no transaction terms had been agreed and that a merger should not be regarded as inevitable.
Musk identified AI software, semiconductor design, and robotics as areas where closer cooperation could be beneficial. The companies are also jointly developing the planned Terafab chip manufacturing complex. Any transaction would require support from a majority of all outstanding Tesla shares, rather than merely those participating in a vote—a substantial approval threshold. At Tuesday's closing prices, the companies' combined market capitalization was approximately $3.5 trillion, although that valuation does not represent a negotiated transaction price. Existing financial ties include Tesla's $2 billion investment, which became a SpaceX holding following SpaceX's acquisition of xAI.
The disclosure accompanied SpaceX's July–September results, which showed net income of $4.4 billion and revenue growth of 161% to approximately $14.6 billion. Its AI division generated roughly $7.6 billion, surpassing Starlink satellite internet as the company's largest revenue source. SpaceX attributed the improvement to new cloud-computing agreements, wider adoption of its Grok chatbot, and its acquisition of AI coding company Cursor. Despite that growth, spending remained substantial: of the $19.6 billion invested during the quarter, $16.4 billion went into AI.
