Musk says merging SpaceX and Tesla would be a ‘good idea’; boards form special committees

Elon Musk has backed the idea of combining SpaceX and Tesla, saying a merger between the two companies would be a “good idea”, while cautioning that no deal has been agreed and that shareholders would ultimately have to approve any transaction.

Speaking during SpaceX’s third-quarter earnings call, Musk confirmed for the first time that both companies have formed special committees of independent directors to discuss a potential combination. He said the committees were created at the request of shareholders.

“Do I think it would be a good idea? Yes,” Musk said. He added that it would be premature to assume a merger was certain, saying the special committees had not reached agreement on the terms of any transaction and that there was “no guarantee” they would do so.

Musk sees overlap across AI, chips, robotics and connectivity

Musk said he is unable to participate in the committee discussions because he is a “conflicted party”. He also pointed to the shareholder approval required for any transaction, particularly at Tesla.

“Particularly on the Tesla side, we will need a 50% vote of all shares, not just those who vote, but of all shareholders,” he said, describing this as “quite a high hurdle”.

The Tesla-SpaceX relationship has been expanding beyond Musk’s common leadership of the two companies. Tesla disclosed in a regulatory filing that it invested about $2 billion in SpaceX in March 2026, acquiring Class A common stock after its earlier agreement to invest in xAI was converted following the SpaceX-xAI merger. Tesla said the investment represented less than 1% ownership of SpaceX.

Tesla also disclosed commercial dealings with SpaceX. In the first half of 2026, SpaceX purchased Tesla Megapack products worth $405 million in revenue for Tesla.

Musk said the strategic case for combining the companies goes beyond these existing transactions. “There’s a lot of merit to combining the companies,” he said, citing what he described as the “super intelligence singularity” and potential cooperation in “super intelligence software, chip design, the Terafab obviously, robotics, mass to orbit with the Starmind constellation” and connectivity.

Terafab is particularly relevant to the overlap between the companies. Musk said during the call that the semiconductor project is expected to produce its first test chip around May or June next year, with volume production targeted for the third quarter of 2028.

The timing also comes as SpaceX’s business expands beyond launches and satellite connectivity. The company reported third-quarter revenue of $14.6 billion, up 161% year-on-year, with net income of $4.4 billion and adjusted EBITDA of $8.8 billion. SpaceX said the revenue growth was driven by its Super Intelligence business and Connectivity segment.

SpaceX said its Super Intelligence solutions and infrastructure revenue increased by $6.7 billion year-on-year, while nameplate computing capacity reached 1.7 GW by September 30. The company also said it had completed its acquisition of Cursor in August at an implied equity value of $60 billion.

For now, however, Musk’s message remains conditional. “It’s really up to the special committees of both companies,” he said. “They’ve got to come up with something, and then that’s got to be put to the shareholders as a vote.”