Musk Says Tesla, SpaceX Formed Merger Committees

Tesla and SpaceX have each formed special committees to evaluate a possible merger, Elon Musk said Tuesday during SpaceX’s third-quarter earnings call.

Musk said the committees were set up at the request of shareholders, but cautioned that a deal is far from guaranteed. Neither SpaceX’s earnings filing nor any Tesla filing mentions the committees, so for now Musk’s remarks on the SpaceX investor webcast are the only source.

His comments come just days after activity between Tesla and SpaceXAI executives on X fuelled speculation that the two companies could be preparing to join forces.

They also mark a shift in tone from when Musk dismissed a report of a SpaceX merger tied to the sale of Tesla’s China operations as “fake news.”

On the call, Musk said the committees are made up of independent directors, and that his role at both companies keeps him out of their talks.

“So both SpaceX and Tesla have formed special committees to discuss this idea at the request of shareholders. And these special committees are [consisting] of independent directors, and because I’m a conflicted party, I can’t actually be in the discussions of the special committees. So it’s an odd kabuki dance where two groups of people are talking and I can’t be in the conversation.”

He also pushed back on the idea that a combination is a done deal.

“I think some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it. Do I think it would be a good idea? Yes.”

Musk pointed to a significant obstacle on the Tesla side: by his account, a merger would need the backing of 50% of all Tesla shares, not just a majority of the shares that are actually voted. He called that “quite a high hurdle to try to achieve.”

He added that “the special committees have not reached agreement on the terms of any transaction, and obviously there’s no guarantee that they will.” Even so, Musk argued that combining the companies has merit, pointing to potential cooperation on superintelligence software, chip design, the Terafab project, robotics, launch capacity for the Starlink constellation and connectivity.

Analysts are taking the possibility seriously, though no formal plan exists, according to The Wall Street Journal. Barclays analyst Dan Levy said a deal could be unveiled ahead of the December 3 Tesla annual meeting.

Neither company has named the committee members or released a merger proposal. Any agreement would still have to be put to shareholders, leaving the outcome far from certain.

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