SpaceX-Tesla Merger Talks Advance, December Announcement Possible

SpaceX and Tesla have progressed in merger talks, and a deal could be announced as early as December, Bloomberg News reported Thursday, citing people familiar with the matter. A slip into early 2027 has also been discussed, the report said. The Information separately reported the two companies could announce a merger as soon as December.

At the last close before the report, SpaceX carried a market value of about $1.90 trillion and Tesla about $1.55 trillion, according to Reuters. A combination would rank as the largest corporate acquisition on record — and put Elon Musk's rockets, satellites, AI models, electric cars and robots under a single corporate roof. Reuters said neither company could be reached for comment.

How did the talks get here?

Musk lit the fuse himself. On SpaceX's third-quarter earnings call last month he called a Tesla merger "a good idea" and confirmed both companies had formed special committees of independent directors to negotiate a combination. He has also hedged. "Some people out there assume that a SpaceX and Tesla merger is a certainty... I think that would be overstating it," he said.

SpaceX went public in June and has already absorbed Musk's AI company xAI. The two listed companies already share one venture with a hard silicon roadmap: Terafab, a chipmaking joint venture that Musk said should produce its first test chip around May or June 2027 and reach volume production by the third quarter of 2028. Terafab has told Japanese toolmakers it wants 1 million wafers a month from 2032, Nikkei reported.

Politics frames the clock. Bloomberg has reported Musk wants a deal closed while Donald Trump is in office. Both stocks fell after Democrats won control of Congress in the Nov. 3 midterms; the two companies shed about $425 billion of combined market value over two days.

What would Tesla shareholders get?

No terms exist yet in public. Bank of America analyst Alexander Perry expects SpaceX to pay in stock rather than cash. On his numbers, one Tesla share is worth about 2.8 SpaceX shares before any premium; at a 20% premium to Oct. 20 prices, Tesla holders would own roughly 47% of the combined company. Barclays estimates Musk would hold about 56% of the combined voting power — he already controls more than 80% of SpaceX's votes.

Regulation is the harder wall. Perry named China, where Tesla builds about half its cars, as the main risk. Bloomberg's report also flagged SpaceX's U.S. defense contracts, including the Starshield military satellite service used by Ukraine, as a hurdle.

What stands between announcement and closing?

Tesla's annual meeting on Dec. 3 carries no merger item on its ballot, so a December announcement would kick off a separate approval process. Tesla's charter demands a majority of all outstanding shares — meaning abstentions and unvoted shares count against the deal. The precedent is fresh: in 2025, a non-binding proposal for Tesla to invest in xAI drew more votes for than against and still failed, killed by 473 million abstentions.

Musk has recused himself from the merger decision, leaving the pace to the independent committees, according to the report. The companies have said nothing about an exchange ratio, a combined board or where the merged entity would list.

BofA's stock-swap math and Tesla's abstention-heavy charter suggest that even a December announcement would start a months-long approval and regulatory gauntlet, with China exposure and U.S. defense contracts the two variables most likely to move the timeline.