Elon Musk indicated on Tuesday that a merger between Tesla and SpaceX is a desirable outcome, stating simply "Yes" when asked about the prospect. He noted that special committees are evaluating a potential combination, though he emphasized no agreement has been reached and the deal remains uncertain. With Tesla valued at roughly $1.5 trillion and SpaceX at $2 trillion, a merger would represent the largest such transaction ever attempted. Any final agreement would require approval from Tesla shareholders, a threshold Musk described as "quite a high hurdle."

During Tesla's earnings call on Wednesday, Musk offered no new details but described the situation as "tap-dancing through a minefield." He later clarified that calling the merger a certainty would be "overstating" the situation. Tesla reported a modest decline in third-quarter revenue, with sales of $28.05 billion compared with $28.1 billion a year earlier. Musk argued that combining the companies' work on chips, artificial intelligence and other technologies would create synergies, specifically citing the integration of Tesla's vehicles, robots and self-driving systems with SpaceX's rockets, data centers, satellites and telecommunications operations.

Musk has been consolidating his business interests, having previously acquired xAI and the social media platform formerly known as Twitter through SpaceX. If the merger proceeds, it would be decided by shareholder vote, with half of Tesla's shareholders needing to approve the deal. Investment analyst Dan Sheehan of Telos Wealth Advisors suggested that shareholders are likely to support the merger, given the complementary nature of the companies' technological development. However, he noted that Tesla shareholders would end up owning a "smaller slice of a much larger and more complex business," and that there is no established precedent for valuing a combined entity.

Market reactions followed the announcement, with SpaceX's private shares rising 8% in after-hours trading and Tesla's public stock climbing 2%. Experts told the BBC that customers would likely see limited immediate changes, as vehicles appear to be an "afterthought" in Musk's current focus. Tesla has already shifted production priorities toward its best-selling Model Y and Model 3, while also using a California facility to manufacture humanoid robots called Optimus. Sheehan suggested that integrating SpaceX's AI and satellite infrastructure with Tesla's self-driving technology could yield more capable vehicles, though questions remain about how much priority cars would receive within an increasingly AI-driven organization.

The proposed merger would likely increase Musk's control over the combined company, potentially consolidating his influence over strategic decisions. It could also draw regulatory scrutiny, particularly if political dynamics shift ahead of the upcoming U.S. midterm elections. Musk, who became the world's first trillionaire earlier this year, stands to benefit from greater voting power within the merged entity, though analysts note the deal does not directly increase his personal wealth. Instead, it would concentrate his existing holdings into a single publicly traded stock. The merger aligns with Musk's stated ambition of advancing space colonization, a goal he has pursued through SpaceX's development of reusable rockets and Mars-related initiatives.