Elon Musk told investors Tuesday that combining his two flagship companies, SpaceX and Tesla, is “a good idea,” and confirmed that independent special committees have been established at both firms to explore the potential merger. Speaking on a conference call, Musk acknowledged his own conflict of interest in any such transaction, noting that he would recuse himself from the committees’ deliberations.
“I think it would be a good idea, but it’s really up to the special committees of both companies,” Musk said, according to a Reuters report. “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees.”
The committees were formed at the request of shareholders, who would ultimately need to approve any deal. Musk stressed that no transaction terms have been agreed upon and that the committees may never reach a consensus, Reuters reported.
Musk argued there is “a lot of merit” to uniting the two firms, citing their overlapping work in advanced technologies. “As we are pretty much in the superintelligence singularity, and there’s a lot to be gained from cooperating on developing superintelligence software, chip design, the Terafab obviously, robotics, mass-to-orbit with the Starmind constellation, connectivity,” he said.
On the call, Musk also provided an update on Terafab, the chip manufacturing joint venture between the two companies, saying its first test chip is expected around May or June of next year, with volume production targeted thereafter.
News of the potential merger boosted both stocks on Wednesday morning, with SpaceX shares rising more than 8 percent and Tesla shares gaining over 2 percent, according to CNN.
The merger talk comes amid renewed scrutiny of Musk’s role in Ukraine’s military operations. Earlier this month, Ukrainian forces experienced restricted access to Starshield, the military version of Starlink, following an order Musk reportedly gave to slow the service, according to The Wall Street Journal, which cited U.S. officials and sources familiar with the matter. Several Democratic lawmakers have called for an investigation into the incident.
Musk initially claimed on X that only President Trump had the authority to order such a slowdown, and he clarified that while Starlink is operated by SpaceX, Starshield is owned and run by the U.S. government. The disruption reportedly affected the capabilities of Ukrainian drones, airplanes, and helicopters.
The proposed merger would mark one of the largest corporate combinations in history, uniting a leading electric vehicle maker with a dominant private space launch provider. However, regulatory hurdles and the inherent conflicts of interest are likely to pose significant challenges. Shareholder approval would be required, and any deal would face intense antitrust scrutiny in Washington.
