Elon Musk is preparing a historic move: Tesla and SpaceX are negotiating a merger that could be announced in December.
Elon Musk may be preparing one of the largest corporate deals in history. The American billionaire, known for leading Tesla and SpaceX, is getting closer to bringing two of his most important companies under a single corporate structure. This move would represent a groundbreaking step that combines the electric vehicle industry with aerospace, artificial intelligence, and robotics sectors.
According to Bloomberg, citing people familiar with the discussions, Tesla and SpaceX have intensified negotiations for a potential merger. The talks have progressed to the point where both companies are considering announcing an agreement by next December, though there is also a possibility of delaying it until early 2027.
Information later reported by Reuters indicates that the boards of directors and their advisors are working on the terms of the merger and the future governance structure of the resulting company. So far, neither company has confirmed an ultimate agreement, meaning the negotiations could still end without a merger taking place.
A deal that could exceed $3,000,000,000,000
The economic scale of this deal helps explain why it is generating so much anticipation. According to valuations compiled by Reuters, SpaceX has a market capitalization of approximately 1.90 trillion dollars, while Tesla is valued at around 1.55 trillion. Together, the two companies total about 3.45 trillion dollars, a figure that would place them among the world’s largest corporate giants. This amount represents the sum of their stock market valuations, not an agreed-upon merger price.
The most significant aspect is that these discussions are not based solely on speculation. Tesla has already officially acknowledged, in its third-quarter financial documents submitted to the U.S. Securities and Exchange Commission (SEC), the creation of a special committee composed of independent directors to explore greater integration with SpaceX. Among the options under consideration is explicitly a potential business merger.
SpaceX also confirmed the existence of its own committee in its official documents. Additionally, Musk had already stated during the company’s quarterly results presentation on October 20 that he viewed positively the possibility of merging the two businesses. However, the companies warned that any merger would be subject to the necessary approvals and permissions.
Electric cars, artificial intelligence, and rockets under one company
One of the main reasons to pursue this merger would be to leverage the technological connections between the two companies. Tesla has gradually expanded its activities beyond electric vehicle manufacturing, investing in autonomous driving, artificial intelligence, energy storage, and the development of Optimus, its humanoid robot. SpaceX, on the other hand, combines rocket launches with satellites, communications, and new technological infrastructure.
The business relationship between the two companies is already significant. In its accounts for the first nine months of 2026, Tesla reported $626,000,000 in revenue from selling Megapack systems to SpaceX. It also confirmed a $2,000,000,000 investment in the aerospace company’s stock made in March, representing a stake of less than 1% of its capital.
In addition to these partnerships, there is Terafab, the joint project through which the two companies aim to develop their own semiconductor manufacturing capabilities. According to Musk, the initiative plans to produce its first test chips between May and June 2027, with the goal of achieving large-scale production in the third quarter of 2028. A potential merger could facilitate the coordination of these investments, although their specific benefits have not yet been quantified.
Elon Musk’s biggest obstacle lies in China
Despite progress in the negotiations, the deal faces significant regulatory challenges. One of the most delicate issues relates to SpaceX’s relationship with the U.S. government, particularly regarding its contracts related to national defense and security. These activities could create conflicts with Tesla’s substantial industrial and commercial presence in China.
In fact, JPMorgan analysts have warned of the difficulties involved in integrating a company with major U.S. defense contracts with another that relies heavily on its operations in the Chinese market. Authorities may require additional measures to protect certain technologies, information, or strategic activities before approving any potential merger.
The share structure of the new company and the terms that current Tesla and SpaceX investors would receive also remain unresolved. Official documents from both companies warn that there is no guarantee the merger will go through. However, progress in the discussions presents Elon Musk with an unprecedented opportunity: to bring together his key businesses in electric vehicles, robotics, artificial intelligence, and space technology under one company.