Elon Musk has held preliminary discussions about potentially consolidating parts of his business empire, including exploring whether SpaceX could merge with Tesla or absorb his artificial intelligence startup xAI, according to company filings and sources cited by Reuters and Bloomberg.
SpaceX has evaluated the feasibility of a combination with Tesla, an idea that some investors have encouraged, the sources said. Executives have also discussed an alternative scenario in which xAI would be folded into SpaceX ahead of a potential public offering later this year that could value the combined entity at up to $1.5 trillion. No decisions have been taken, and the talks remain at an early stage, the sources added.
See also: Musk Says China Likely to Be Tesla’s Biggest Rival in Humanoid Robots
The discussions reflect Musk’s interest in closer integration among his companies as their technologies increasingly intersect. For years, Musk has highlighted strategic links between Tesla and SpaceX, pointing to shared engineering approaches and overlapping leadership. Tesla has also used SpaceX’s Starlink satellite service for connectivity testing and adopted manufacturing practices inspired by SpaceX’s rapid-iteration model.
However, a merger between SpaceX and Tesla would present significant challenges. Tesla is publicly listed with a wide shareholder base, while SpaceX is privately held and tightly controlled by Musk, raising potential regulatory and governance concerns. Such a transaction would likely face scrutiny from regulators and investors over conflicts of interest and corporate oversight.
See also: Tesla Beats Q4 Earnings Expectations as Margins Improve and Energy Business Sets Records
The option of integrating xAI into SpaceX is seen by some observers as more straightforward. CNBC reported that Musk has discussed merging xAI into SpaceX via a share swap, potentially involving newly created Nevada-based entities linked to SpaceX. Under that structure, xAI shareholders would receive SpaceX stock, effectively bringing the AI company under SpaceX’s corporate umbrella.
Musk has not publicly commented in detail on the talks, and representatives for SpaceX, Tesla and xAI have not confirmed any specific plans. One source familiar with the discussions said the conversations were exploratory and driven by long-term strategic considerations rather than imminent transactions.
