Tesla and SpaceX Merger Talks Target December Announcement

Tesla and SpaceX are negotiating a merger that could be announced as soon as December, according to Bloomberg, which cited people familiar with the talks. The two sides have also discussed pushing the announcement into early 2027. Neither company has confirmed the report.

If it happens, the deal would rank among the largest mergers ever. Electrek puts SpaceX’s value at over $1.9 trillion after its June IPO and Tesla’s at around $1.5 trillion, while Not a Tesla App cites figures of about $1.90 trillion and $1.55 trillion. Tesla stock rose as much as 1.9% on the report, Electrek said.

Talks have moved to price and control

Bloomberg’s sources describe the current stage as a negotiation over price and who controls the combined company, with boards and advisers on both sides taking part. One open question is how many SpaceX shares Tesla investors would get for their stock. Electrek reads that as SpaceX absorbing Tesla rather than the reverse.

Musk confirmed last month that both companies had set up special committees of independent directors to study a merger, a step taken at shareholders’ request. He has said he supports the idea but cannot join the talks because he is a conflicted party.

Approval is harder on the Tesla side

At SpaceX, Musk controls more than 50% of the voting power, so approval there is expected to be simple. Tesla is different. A merger would need backing from 50% of all outstanding Tesla shares, counting shares that do not vote, a bar Musk called “quite a high hurdle.”

Tesla’s annual shareholder meeting on Dec. 3 does not include a merger proposal, so any vote would come later. The ballot covers re-electing Musk, chair Robyn Denholm and JB Straubel to terms through 2029, a say-on-pay vote and the auditor, according to Electrek. Some shareholders want faster action: a letter asking the board to fast-track a deal drew more than 6,400 signatures representing over 17.5 million shares.

What it means for Tesla shareholders

Musk owns about 20% of Tesla, where each share carries one vote. According to SpaceX’s S-1 filing, he controlled roughly 85% of SpaceX’s voting power through super-voting shares. Trading Tesla stock for SpaceX stock would move shareholders into a company where Musk’s control is effectively fixed, Electrek noted.

The deal would also pay Musk. Under the change-in-control terms of his 2025 CEO award, the operational milestones drop out and the market cap test is measured at the deal price, with earned shares vesting at once. Electrek calculated from the proxy share count that a deal valuing Tesla at $2 trillion, about a 33% premium to its current price, would clear the first market cap tranche immediately. His 286 million restricted shares from the 2018 package would also vest early on a change in control.

China and Washington stand in the way

Bloomberg reports that a main obstacle is how to wall off Tesla’s China business from SpaceX’s U.S. defense and government contracts. A JPMorgan analyst called the two “key dynamics that are at odds with each other” for regulators and shareholders. Giga Shanghai builds more than half of Tesla’s cars and shipped 67,829 vehicles in October alone, Electrek reported.

Politics adds another variable. Democrats won control of Congress in the midterms and have said they will scrutinize Musk’s companies and his political ties. Bloomberg previously reported that the companies want to close a deal before President Trump leaves office.

The companies already do business together

SpaceX bought about $506 million in Megapacks and $130 million in Cybertrucks from Tesla in 2025, and the new flying Roadster was developed with SpaceX’s help. The two are also partners in Terafab, a chip plant under construction in Texas. Musk said on Tesla’s third-quarter earnings call that Terafab should make its first test chip around May or June 2027 and reach volume production by Q3 2028. Those chips are meant for Optimus, Cybercab and orbital AI data centers that SpaceX plans to launch on Starship.

What happens next

If talks stay on schedule, an announcement could come within weeks. That would start what Not a Tesla App expects to be a long approval process at both companies and with regulators. Tesla shareholders meet on Dec. 3, and the directors up for re-election that day are the same people who would sign off on any deal.

Sources: Not a Tesla App, Electrek