SpaceX and Tesla have formed special committees of independent directors to discuss a potential merger, Elon Musk said on SpaceX’s third-quarter earnings call on 20 October 2026, Axios reported. Musk, who serves as CEO of both companies, said the committees have not reached agreement on the terms of any transaction and that there is no guarantee they will, The Verge reported.
“Because I’m a conflicted party, I can’t actually be in the discussions,” Musk said, according to Axios, adding: “I think it would be a good idea.” The decision rests with the special committees of both companies, he said, The Verge reported.
Update, 20 October: Musk Says a Merger Has “a Lot of Merit”
Musk gave a fuller case for combining the companies on the call, Ars Technica reported: “Obviously there’s no guarantee that they will, but I do think there’s a lot of merit to combining the companies as we are pretty much in the superintelligence singularity.”
He listed the areas where he sees gains from cooperating: “superintelligence software, chip design, the Terafab, obviously robotics, mass to orbit with the Starmind constellation, and connectivity,” per Ars Technica. Musk also said that “at the end of the day the shareholders have to be supportive of this,” the outlet reported.
Business Pill · CAPEX AND DEPRECIATION
A short explainer on capex and depreciation: how money spent on long-lived assets such as data centres turns into a cost over years. It teaches the general idea only and says nothing about any company in this story.
The key insight: As we read it, Musk moved the merger question from investor upvotes to a board process on the call: special committees of Tesla and SpaceX are discussing a possible merger, with no terms agreed and no guarantee, according to The Verge.
The remark came hours after a merger question ranked second among the questions investors submitted to SpaceX management before the webcast, with 26 upvotes, and drew 128 upvotes on Tesla’s investor relations site, Reuters reported earlier on 20 October.
Before the call, Reuters reported that neither company nor Musk had officially committed to favoring a deal. On the call, Musk described the committees as discussing a possible merger, with no terms agreed, according to The Verge.
Earlier this month, Barclays published a client note suggesting a potential Tesla-SpaceX combination could be announced ahead of Tesla’s annual shareholder meeting, scheduled for 3 December 2026, The Verge reported.
Business and financial ties between Elon Musk’s companies, as reported by CNBC on 20 October 2026: Tesla invested $2 billion into xAI, which later converted into shares of SpaceX, and the AI unit of SpaceX spent about $430 million last year on Tesla’s Megapacks and $143 million on Cybertrucks. Musk said on SpaceX’s third-quarter call that special committees of both companies are discussing a possible merger and have not agreed terms, The Verge reported.
The Hurdle Musk Named
Musk said “there’s a lot to be gained” from cooperation on technologies like AI, chips, robotics and connectivity, Axios reported. He also said a deal is not certain: “I think that would be overstating it,” he said, according to Axios.
Musk noted that 50% of Tesla shareholders would need to approve a deal, which he called a high hurdle, Axios reported.
The Ties Already in Place
Musk’s companies have had business and financial relations for years, even sharing personnel and some board members, CNBC reported in its earnings live blog. Tesla invested $2 billion into xAI, which later converted into shares of SpaceX, according to CNBC.
The AI unit of SpaceX also spent about $430 million last year on Tesla’s Megapacks, battery energy storage systems, and $143 million on Cybertrucks, CNBC reported. SpaceX chief operating officer Gwynne Shotwell told CNBC ahead of the June IPO that a merger “might make Elon’s life a little easier.”
Tesla is scheduled to post its third-quarter results on Wednesday, 21 October, CNBC reported, and analysts expect revenue at the electric vehicle maker to dip slightly from a year ago to $27.9 billion, according to LSEG.
As we read it, the change is in who decides: Musk said he thinks a merger would be a good idea, but he placed the decision with the special committees of both companies, The Verge reported.
As we read it, the ties CNBC lists are the starting point for those committees: Tesla’s $2 billion investment into xAI, which later converted into SpaceX shares, and the SpaceX AI unit’s purchases of Megapacks and Cybertrucks.
As we read it, the timing matters because Tesla reports its own third-quarter results on Wednesday, CNBC reported, and Barclays has suggested a combination could be announced before Tesla’s 3 December annual meeting, The Verge reported.
SPECIAL COMMITTEES, NO TERMS The committees have not reached agreement on the terms of any transaction, and there is no guarantee they will, Musk said, according to The Verge.
$2 BILLION ALREADY INVESTEDTesla invested $2 billion into xAI, which later converted into shares of SpaceX, CNBC reported.
A 3 DECEMBER MARKER Barclays suggested a combination could be announced ahead of Tesla’s 3 December 2026 annual shareholder meeting, The Verge reported.
The framework sizes the cycle this way: “The total cycle: $725B Big Four + $50B Oracle + $13B Apple + $60B Neoclouds + $80B China + $60B Sovereigns + $48B Other = ~$1.04 trillion in 2026 compute capex, the first trillion-dollar year of compute capex in human history.”
As we read it, a Tesla-SpaceX merger question is partly a question of whose balance sheet funds SpaceX’s share of that cycle, after its chief financial officer said it would spend $35 billion to $40 billion on new capital investments in the fourth quarter, according to TechCrunch. The framework was published in May 2026 and does not discuss a Tesla-SpaceX merger.
What Is Not Established
No merger terms, structure, price or timetable have been reported, and Musk said there is no guarantee the committees will reach agreement, according to The Verge. We have not seen a filing by either company about the special committees, and we have not read the Barclays note; it is attributed to The Verge’s report.
Business Engineer Framework
The AI Capex Map
A Business Engineer analysis of how the AI build-out is financed, where it cracks and who can absorb it.
Musk said on SpaceX’s third-quarter call that Tesla and SpaceX special committees are discussing a possible merger and called it “a good idea,” while saying no terms have been agreed, The Verge reported. As we read it, the ties CNBC lists, from Tesla’s $2 billion xAI investment to the Megapack purchases, are the existing links any committee would weigh.
A note on sourcing. Musk’s remarks are as reported by Axios and The Verge on 20 October 2026, both read in full, and the Barclays note as reported by The Verge; we have not heard the call recording or seen a filing about the special committees. The related-party figures are from CNBC’s earnings live blog, and the question rankings from Reuters. Nothing here is financial or investment advice.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
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