Elon Musk Says Tesla and SpaceX Might Join Together Into One Giant Company

Elon Musk announced on Tuesday that his two famous companies — Tesla and SpaceX — are looking into joining together into one company. This kind of joining is called a merger. If it happens, the new combined company could be worth close to $5 trillion, which would make it the biggest deal in business history. Both companies have already set up special groups to study the idea and decide if it makes sense.

Musk spoke about the idea during a SpaceX earnings call, which is a meeting where company leaders talk to investors — people who have put money into the company. He said he sees a lot of value in combining the two businesses. Investors reacted quickly to the news. Tesla's stock price went up 3.8%, and SpaceX shares jumped nearly 10% on the same morning.

So how big would this deal actually be? SpaceX is currently worth about $1.98 trillion, and Tesla is worth about $1.5 trillion. But a Wall Street analyst named Dan Ives said Tesla's shareholders would probably want more money per share before agreeing to the deal. He thinks Tesla shares would need to be priced around $500 to $550 each for the merger to go through. That would push the total value close to $5 trillion, putting it near giants like Nvidia and Apple.

The main reason Musk wants to merge the companies has to do with artificial intelligence, or AI. AI is technology that lets computers think, learn, and make decisions on their own. Musk believes AI will become a huge part of everyday life in the future. He thinks combining the two companies will help them work together on AI tools, robots, and special computer chips.

Tesla is still best known for making electric cars, but Musk has said the company is slowly moving away from traditional vehicles. In January, he announced that Tesla would stop making its Model S and Model X cars. Instead, Tesla wants to focus on self-driving robot taxis and humanoid robots — robots that look and move like humans. Tesla's humanoid robot, called Optimus, could be available as early as 2027.

SpaceX also has a major connection to AI through a company called xAI, which created a chatbot named Grok. A chatbot is a computer program that can have conversations with people. Grok is used in the social media app X, which Musk also owns. Musk is also planning a huge chip factory called Terafab that would make computer chips for both Tesla and SpaceX, tying the two companies even closer together.

Even though many people are excited about the idea, Musk warned that the merger is not a sure thing. He said that at least 50% of all Tesla shareholders — not just those who vote, but every single shareholder — would need to approve it. Musk called this a very high bar to reach. Still, analyst Dan Ives believes there is an 80% to 90% chance the merger will happen before the end of 2027.