Tesla and SpaceX are exploring a merger, and Musk says it’s about superintelligence

Tesla and SpaceX have each set up special board committees to explore merging the two companies, Elon Musk said on SpaceX’s third-quarter earnings webcast on Tuesday, and he made the case for a deal in terms of building superintelligence.

Musk, who runs both companies, said the committees are made up of independent directors and have not agreed any terms. He called a combination “a good idea”, but said it was far from certain and would need the backing of Tesla’s shareholders. Neither company had filed a statement about the committees with the US Securities and Exchange Commission by Tuesday evening.

“An odd kabuki dance”

Musk said he is not on either committee and is not part of the talks. “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees,” he said. “So it’s an odd kabuki dance where two groups of people are talking and I can’t be in the conversation.”

The question was already on investors’ minds. “When will SpaceX merge with Tesla?” was among the questions shareholders submitted on SpaceX’s Q&A platform ahead of the call. In January, before SpaceX bought Elon Musk’s AI lab xAI instead, Bloomberg reported that SpaceX had weighed a merger with Tesla as an alternative.

Making the case for a deal, Musk put AI first:

I do think there’s a lot of merit to combining companies 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.

Elon Musk, CEO of SpaceX and Tesla, on SpaceX’s Q3 2026 earnings webcast

A high bar at Tesla

Musk was careful not to oversell it. “At the end of the day, the shareholders have to be supportive of this,” he said. “And particularly on the Tesla side, we will need a 50 percent vote of all shares, not just those who vote, but of all shareholders. And that’s quite a high hurdle to try to achieve.”

That means a deal would need more than half of every Tesla share, including those held by investors who never vote, not just a majority of the votes cast. Any terms would come from the two committees first and then go to shareholders. Tesla reports its own third-quarter results after the US market closes on Wednesday, October 21.

Two companies already sharing AI

The deal Musk described would put most of his AI bets under one roof. SpaceX’s AI unit, now called Super Intelligence and home to Grok and the coding company Cursor, took in $7.56 billion in the third quarter, more than Starlink, according to the results SpaceX filed earlier on Tuesday. Tesla’s own AI work centres on its Optimus humanoid robots, Full Self-Driving and robotaxis.

The two companies are already tangled together. Tesla invested $2 billion in xAI, a stake that became SpaceX shares when the two merged, and SpaceX’s AI unit spent about $430 million on Tesla Megapack batteries last year, CNBC reported. Musk said on the call that SpaceX aims to reach volume production of AI chips, developed with Tesla and Intel, at its planned Terafab factory in Texas in the third quarter of 2028. Teslas now carry SpaceXAI’s Grok Bot, and the two firms are jointly building Digital Optimus, a computer-use AI that Musk says can play games by watching the screen. Tesla is also building hundreds of Optimus robots a week.

Why it matters

A merger would join the company behind Grok and Cursor with the one building Optimus robots and robotaxis, giving Musk one balance sheet for chips, data centres and AI he says is heading for superintelligence. It is still only an idea in committee, and the vote it needs at Tesla is a hard one to win.

Sources: SpaceX Q3 2026 earnings webcast; SpaceX investor relations: Q3 2026 earnings event; SpaceX Q3 2026 shareholder Q&A; SpaceX third-quarter 2026 results (Form 8-K, Exhibit 99.1, SEC); CNBC; Reuters, citing Bloomberg News (January 29, 2026).