Elon Musk is considering a merger between Tesla and SpaceX that could create a company valued at approximately $3.5 trillion (€3.1 trillion), potentially making it the largest merger in history.
According to Bloomberg, the aim is to advance the deal while Donald Trump remains US president, potentially creating a more favourable political environment.
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A Decade Of Consolidating Musk’s Businesses
The proposed merger would extend Musk’s efforts to bring his companies closer together through acquisitions and restructurings.
In 2016, Tesla acquired SolarCity, the solar installer run by Musk’s cousins. In March 2025, his AI start-up xAI absorbed X, formerly Twitter, which he bought for $44 billion (€39.1 billion) in 2022. SpaceX acquired xAI in February this year, in a deal valuing SpaceX at $1 trillion (€890 billion) and xAI at $250 billion (€222 billion).
Four months later, SpaceX listed on the Nasdaq, raising $85.7 billion (€76.3 billion) in what the report described as the largest stock market debut on record.
Why Musk Wants To Combine Tesla And SpaceX
Musk increasingly presents his companies as parts of a shared technology ecosystem, with AI central to their future growth. Tesla and SpaceX are jointly developing Terafab, an AI chip factory in Texas, while Tesla’s autonomous vehicles and Optimus humanoid robots could benefit from SpaceX’s computing infrastructure, including planned orbital data centres.
Their financial performance offers another potential incentive. SpaceX recently reported its first quarterly profit since going public, earning $4.4 billion (€3.9 billion) as revenue rose 161%. However, capital spending reached $19.6 billion (€17.4 billion).
Tesla, meanwhile, reported net profit of $787 million (€700 million), down 43% year on year, on flat revenue of $28 billion (€24.9 billion). Deliveries fell 2%.
Combining the businesses could help balance their financial performance and allow Musk to share capital, engineers and intellectual property more easily across the group.
Control, Compensation And Political Timing
The merger could also strengthen Musk’s control. He owns around 48% of SpaceX and controls more than 80% of its voting power, compared with approximately 20% ownership of Tesla. Since 2024, he has said he wants at least 25% voting control of Tesla to lead its expansion into AI and robotics.
His compensation package at Tesla also includes certain merger outcomes as milestones, potentially providing an additional financial incentive.
Bloomberg reported that the plan is to announce a merger in the first half of 2027 and complete it before Trump leaves office in January 2029. The deal would nevertheless face regulatory and shareholder scrutiny.
Musk’s relationship with Trump adds to the political backdrop. After publicly falling out with the president in 2025, Musk has since reconciled with him. He has also contributed more than $276 million (€245 million) to support Republican candidates since July, according to a spokesperson for America PAC.
A Democratic victory in the US midterm elections could bring closer scrutiny of SpaceX’s federal contracts and Tesla’s self-driving technology. SpaceX has warned that a change in congressional control could have a “material and adverse impact” on its growth and competitive position.
A Deal Far From Certain
The merger remains under consideration. Independent board committees have yet to agree on terms, and the transaction would require approval from more than half of Tesla shareholders.
Musk has called that threshold “quite a high hurdle” and acknowledged that the deal may never happen.
Tesla shareholders are scheduled to meet on 3 December, offering an opportunity to gauge investor appetite for Musk’s latest effort to consolidate his business empire.
