A SpaceX Tesla merger is now on the table. On SpaceX’s September quarter results were called on 20 October 2026, Elon Musk said combining the two companies would be a good idea, and that independent directors on both boards have formed special committees to discuss it.
No terms have been agreed. Any deal would need the support of more than half of all Tesla shares, and the two businesses are growing at very different speeds.
Here’s what we know, what we don’t, and what it could mean if you hold either company.
What’s happened
On 20 October 2026, SpaceX reported its September quarter results. On the call, Musk was asked about a possible combination with Tesla. “Do I think it would be a good idea? Yes,” he said, according to CNBC. “But at the end of the day, the shareholders have to be supportive of this.”
Musk said both boards have formed special committees made up of independent directors to discuss the idea. Because he runs both companies, he described himself as a conflicted party who cannot take part in their discussions, TechCrunch reported. He called it an odd arrangement, with two groups of people talking while he stays out of the conversation. Musk said there is a lot of merit to combining the companies, pointing to work across artificial intelligence, chips, robotics and connectivity. Musk said treating a merger as a certainty would be overstating it.
The scale explains the attention. At closing prices on 20 October, a combined Tesla and SpaceX would have a total market value of about US$3.5 trillion, with SpaceX at about US$2 trillion and Tesla at nearly US$1.5 trillion, Fortune reported. CNBC said a combination would mark the largest merger in history. That is a market value, not a deal price: no price, structure or timetable has been set, and neither company has filed merger terms with the US regulator.
Both companies are listed on the Nasdaq, Tesla under the ticker TSLA and SpaceX under SPCX, so Australian investors can follow both share prices alongside other US shares.
Why it binds
The deal turns on Tesla’s shareholders. Tesla’s company charter, filed with the US Securities and Exchange Commission, says a major transaction needs the support of a majority of all shares on issue, not only the shares that are voted. Musk said on the call that this means a 50% vote of all shares, which he called quite a high hurdle.
That rule changes how a vote works. A Tesla share that is never voted cannot count towards a yes, so in practice it works like a no. Musk owns about 19.8% of Tesla, according to its latest notice to shareholders, so most of the support for any deal would have to come from other holders, including large funds and individual investors.
The other side of the deal looks different. Musk’s stake gives him a much larger share of the votes at SpaceX, which makes approval on that side easier. That leaves Tesla’s shareholders as the main test of whether a merger could go ahead.
The two companies are already linked. Tesla completed an investment of about US$2 billion in SpaceX shares in March 2026, according to that same notice, so Tesla shareholders already hold a small indirect stake in SpaceX through the company itself. A full merger would give Tesla shareholders a direct share in all of SpaceX’s businesses.
The two businesses also arrive at this point in very different shape. In the September quarter, SpaceX’s revenue rose 161% to US$14.6 billion from US$5.6 billion a year earlier, according to its quarterly results filing. Tesla’s revenue was flat at about US$28 billion, and its net profit fell 43%, to US$787 million from US$1,373 million, according to its quarterly update. That gap in growth is the core of the case for and against a combination.
Who absorbs it
Tesla shareholders are the group with the most at stake. Under an all-stock deal, the structure analysts at Barclays and JPMorgan have described as most likely, Tesla holders would receive shares in a combined company. That company would include SpaceX’s three businesses: rocket launches, Starlink satellite internet, and an artificial intelligence arm that includes xAI, the maker of the Grok chatbot.
Those businesses are growing quickly. In the September quarter, SpaceX’s AI arm brought in about US$7.6 billion, up 830% on a year earlier and now about half of the company’s revenue. Starlink’s revenue rose 69% to about US$5.2 billion. On paper, a merger could give Tesla investors a share in that growth.
The trade-off is control. If SpaceX bought Tesla at current values, Barclays analysts estimate Musk would own about 37% of the combined company and control 56% of the votes, Yahoo Finance reported. That would give one shareholder majority voting control over a company far larger than Tesla is today.
A no vote would keep Tesla a separate company, with its own results and its own board.
SpaceX shareholders are affected too. A merger would bring Tesla’s car, energy and robotics businesses into their company, along with Tesla’s slower recent growth. Shareholders in both companies, including Australians who hold them directly or through funds, would be weighing different sides of the same exchange.
The independent directors on each committee carry a different kind of weight. Their job is to judge whether any terms are fair to their own shareholders, without Musk in the room. Musk has not named who sits on either committee, so investors do not yet know who is negotiating on Tesla’s side.
What to watch
The first signal is a formal filing. The talks become a formal process only when either company files with the US regulator naming committee members, advisers or terms. As at 22 October 2026, neither SpaceX nor Tesla had filed anything beyond quarterly results.
If terms are filed, the key details are the exchange ratio (how many combined-company shares each Tesla share would become), any premium (extra value above Tesla’s share price), and how votes would be split in the combined company. Those numbers would show how the growth-versus-control trade-off is actually priced, and whether the estimate of Musk holding more than half the votes holds.
The vote itself is a separate test. Tesla’s annual meeting on 3 December 2026 has no merger item on it, so any deal would go to shareholders at a later meeting. Because unvoted shares count against a deal, turnout would matter as much as how shareholders vote. The same meeting will consider the re-election of Tesla’s chair, Robyn Denholm, a former Telstra chief financial officer.
If no terms appear, the two companies keep trading separately, and the merger stays an idea. If terms do appear, every Tesla shareholder would face the same question: growth, or control.
Frequently asked questions
Is the SpaceX Tesla merger confirmed?
No. Elon Musk said on SpaceX’s results call on 20 October 2026 that a merger would be a good idea, and that special committees of independent directors (board members who do not work for either company) on both boards are discussing it. The committees have not agreed terms, no filing sets out a deal, and no shareholder vote has been scheduled.
What would a SpaceX Tesla merger mean for Tesla shareholders?
If a deal is agreed, Tesla shareholders would vote on it, and it would need the support of more than half of all Tesla shares. In an all-stock deal they would hold shares in a combined company with SpaceX’s faster-growing businesses, where Barclays estimates Musk would control 56% of the votes.
How many Tesla shareholders need to approve a merger with SpaceX?
More than half of all Tesla shares on issue, not only those voted, under Tesla’s charter. A share that is never voted cannot count towards a yes, so it works like a no. That makes turnout a central part of any vote on a merger.
