SpaceX and Tesla are progressing in merger negotiations that could produce a deal announcement as early as December or in early 2027, Bloomberg reported, citing people familiar with the discussions1,3.
Each company has formed a committee to study a possible combination, and a formal proposal could follow, though the announcement date remains uncertain. The negotiations now center on price and control, with boards and advisers on both sides involved4. One variable under discussion is how many SpaceX shares Tesla investors would receive, a structure that would amount to SpaceX absorbing Tesla rather than the reverse.
Valuations and scale
The deal's scale would dwarf any prior corporate merger. SpaceX is valued at more than $1.9 trillion following its June IPO, while Tesla sits around $1.5 trillion. For comparison, the previous record for a single transaction was Vodafone's $183 billion takeover of Mannesmann in 2000, and SpaceX's own roughly $250 billion purchase of xAI earlier this year would also be far smaller. Neither company commented on the report. Tesla stock rose as much as 1.9% on the news.
On prediction market Kalshi, odds stood at 67% for a December announcement or a slip into early 2027, with $1.89 million in volume. Morgan Stanley analyst Adam Jonas maintained a $300 price target on Tesla.
Musk's control stake
Elon Musk leads both companies, whose combined operations span electric vehicles, battery packs, rocket launches, satellite internet, and artificial intelligence. A merger could give Musk the voting control at Tesla he has said he wants, without requiring him to meet milestones in his compensation plan. That plan includes a $1 trillion stock award from last year; Reuters reviewed the package with six executive-compensation experts and found a merger would initially give Musk only a small portion of the award.
Tesla holds its annual shareholder meeting on December 3, and the same directors who would sign off on the deal are up for re-election.
AI and robotics threads
The potential combination would consolidate significant AI-related assets under one corporate umbrella. SpaceX said on November 12 that it plans to invest more than $74 billion across two supercomputing campuses in Arizona and Texas[1]. Tesla, meanwhile, is developing its Optimus humanoid robot; Musk said on November 6 that the company will probably rent the robots rather than sell them[3]. ANALYSIS A merged entity would unite SpaceX's large-scale compute buildout with Tesla's robotics and autonomous-driving programs, concentrating AI infrastructure and embodied-AI development in a single organization.