Tesla and SpaceX Are Officially Exploring a Merger, but Nothing's Agreed Yet
Both companies' boards have formed special committees of independent directors to study a possible combination. Musk is recused, no terms exist, and Tesla would need a yes from half of all its shares.
Let’s clear this up first: Tesla and SpaceX have not merged. But for the first time, both companies are formally looking at whether they should, and that’s why the topic is all over X this weekend.
What actually happened
On SpaceX’s earnings call on October 20, Elon Musk said the boards of both companies had formed special committees of independent directors to review a possible combination, which TechCrunch reports were set up at the request of shareholders. Musk called a merger “a good idea” and pointed to overlap in AI software, robotics and chipmaking.
He was also careful to say it isn’t a sure thing. Assuming a merger is “a certainty,” he said, “would be overstating it.”
Why Musk isn’t in the room
Musk runs both companies and is a major shareholder in each, so he’s recused. “Because I’m a conflicted party, I can’t actually be in the discussions,” he said, describing the process as an “odd kabuki dance.”
The filings back that up. Tesla’s quarterly report says its committee of disinterested directors will explore “deepening Tesla’s relationship with SpaceX,” including a possible business combination, with no assurance anything comes of it. SpaceX’s own filing says any deal would need approval from its special committee, its board and its controlling shareholder, Musk, according to Reuters. Reuters describes it as a potential $3.5 trillion combination. NBC News has more on the call.
The fan push
Retail shareholders are trying to speed things along. A letter organized by Alexandra Merz and Amy Steffens says it gathered 6,493 signers holding about 17.5 million shares in under two days, per TeslaNorth. Those numbers are self-reported and unverified, and they’re a small slice of Tesla’s more than 3 billion shares. Organizers say the letter goes to Tesla’s board on Monday, October 26.
The real hurdle
Here’s the part a lot of posts skip. Tesla would need a yes from 50% of all its outstanding shares, not just 50% of the shares that show up to vote. Musk himself called that “quite a high bar.” And Tesla’s annual meeting on December 3 has no merger vote on the agenda.
Bottom line
This is real, it’s official, and it’s early. There are no deal terms, no price and no timeline. Neither company has commented on the shareholder letter. Treat any “merger confirmed” headline you see this week with a lot of skepticism. (And as always, this is news, not investment advice.)
So what do you think: should Tesla and SpaceX become one company, or are they better off apart?
