Elon vs. Elon…

“Tap dancing through a minefield.”

That’s how Elon Musk described the prospect of discussing a merger between Tesla TSLA ( ▲ 3.55% ) and SpaceX SPCX ( ▲ 6.85% ).

And to be fair, negotiating a deal with yourself does present certain complications.

Musk runs both companies. He owns significant stakes in each. And now he thinks combining them would be a good idea.

→ A roughly $3.5 trillion idea, to be precise.

There’s just one minor administrative inconvenience.

He’s not allowed to participate in the independent committees discussing it.

During SpaceX’s earnings call Tuesday, Musk revealed that both companies had formed special committees of independent directors to explore a potential merger.

And because he’s a conflicted party, he says he can’t take part in their discussions.

Corporate governance. What a concept.

Of course, no deal has been announced, and Musk himself cautioned against assuming one is inevitable.

But the idea is hardly coming out of nowhere.

Tesla and SpaceX already share technology, infrastructure projects and a rather busy CEO.

And Barclays has been doing some interesting arithmetic on what combining them might mean for shareholders.

So why merge two companies that already work together — and who stands to gain the most if they do?

Let’s dig in. ⇩

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Two for the Price of $3.6 Trillion…

Most buy-one-get-one deals come with a discount. This one comes with a few extra commas.

Barclays analyst Dan Levy has been running the numbers on what a Tesla–SpaceX merger might actually look like.

And his preferred arrangement?

SpaceX buys Tesla.

Not with cash, mind you. With shares in the combined business — what’s known as an all-stock deal.

Here’s the rather expensive shopping list:

→ SpaceX: Approximately $2.1 trillion.

→ Tesla: Approximately $1.5 trillion.

→ Combined: Roughly $3.6 trillion.

Not exactly a clearance sale.

Of course, nobody has agreed to those terms. These are Barclays’ hypothetical calculations, based on the companies’ reported market values, with no acquisition premium added.

But the interesting part isn’t necessarily the price.

? It’s what happens to the ownership.

Musk currently owns approximately 20% of Tesla and 48% of SpaceX.

Under Barclays’ proposed structure, those stakes would translate into roughly 37% ownership of the combined company.

✱ So Musk could go from owning a fifth of Tesla to owning more than a third of a business containing both Tesla and SpaceX.

Quite the corporate rearrangement.

And here’s the curious part: 37% ownership could give him considerably more than 37% of the votes.

Apparently, even the voting rights come with an upgrade.

More on that next. ↓

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Less Than Half. More Than Enough…

Here’s a curious thing about corporate ownership.

You can own less than half a company and still have the final say.

Convenient, isn’t it?

Take SpaceX.

Elon Musk owns approximately 48% of the company. But he controls roughly 82% of its voting power.

How?

SpaceX has supervoting shares — a special class of stock that carries more votes per share.

Apparently, some shareholders are more equal than others.

And Barclays thinks that arrangement could have some rather interesting consequences if SpaceX acquires Tesla.

Under its hypothetical merger structure:

→ Musk would own approximately 37% of the combined company.

→ But control roughly 56% of the votes.

Less than half the ownership. More than half the voting power.

Not bad for someone who isn’t allowed into the merger committee meetings.

Of course, these are Barclays’ estimates, not agreed deal terms. The actual voting structure would depend on how a merger was negotiated.

But there’s a reason this distinction matters.

Musk has previously said he wants greater control over Tesla as it expands into artificial intelligence and robotics.

And under Barclays’ scenario, a merger could give him majority voting control over a company containing both Tesla and SpaceX.

Quite a lot of influence for a 37% stake.

Still, voting control is one thing.

Making cars, rockets, satellites and humanoid robots work better under the same corporate roof is another. ↓

Cars, Rockets, and Everything Between…

On paper, Tesla and SpaceX make rather different things.
One builds electric cars. The other sends rockets into space.

Not exactly the most obvious corporate marriage.

But Musk’s businesses have been finding increasingly creative ways to overlap.

→ Starlink + Tesla: SpaceX’s satellite network could provide connectivity for Tesla’s robotaxis, autonomous systems and Optimus humanoid robots.

→ Tesla Energy + SpaceX: Tesla’s batteries and energy-storage systems could help power SpaceX’s growing AI infrastructure, including future data centers.

→ Terafab: The two companies are already collaborating on an ambitious semiconductor project intended to produce chips for autonomous vehicles, robotics and AI computing. Musk hopes to begin volume production by late 2028.

→ Manufacturing: Tesla’s experience building vehicles at scale could help SpaceX industrialize production of its Starship rockets.

And then there’s the new Tesla Roadster. The car is expected to use rocket-derived technology.

But there’s a more serious argument behind all this.

A combined company could move money, engineers and technology between projects without navigating two separate corporate structures.

→ Fewer separate approvals. → More freedom to coordinate expensive projects.

Of course, there’s a small detail worth remembering.

Tesla and SpaceX are already collaborating on several of these projects.

Without merging.

So the question isn’t whether the businesses have anything in common.

They clearly do.

It’s whether sharing an owner would accomplish something that sharing technology hasn’t already.

And with SpaceX’s latest financial results, there’s considerably more at stake than rockets and electric cars. ↓

A Trillion Dollars. Give or Take…

Meanwhile, SpaceX has been having a rather eventful year.

→ Rockets. → Satellites. → Artificial intelligence.

And now, a revenue forecast that makes most corporate growth targets look positively modest.

During Tuesday’s earnings discussion, Musk suggested that SpaceX reaching $1 trillion in annual revenue by 2028 was “no longer impossible.”

→ For perspective, SpaceX generated just under $19 billion in revenue in 2025.

✱ Getting to $1 trillion by 2028 would mean growing that figure roughly 53–fold in three years.

That’s less a growth forecast than a mathematical endurance test.

Still, the company’s recent numbers help explain Musk’s enthusiasm.

→ Q3 2026 revenue: Nearly $15 billion, up 161% from a year earlier.
→ Superintelligence division: $7.6 billion in quarterly revenue, up 830% from approximately $800 million.
→ JPMorgan’s 2027 forecast: $254 billion in full-year revenue.

✱ Musk also floated an annual recurring revenue run rate of $500 billion to $1 trillion by the end of 2027.

That’s the yearly pace implied by recurring revenue at a particular point in time — not the same as actually collecting that amount over a full calendar year.

A small accounting distinction.

Only several hundred billion dollars wide.

Even JPMorgan’s substantial 2027 projection remains well below Musk’s suggested revenue ambitions. And the company hasn’t clarified whether his trillion-dollar figure assumes Tesla’s revenue becomes part of the business.

So $1 trillion is an aspiration, not a forecast investors can treat as established.

But the bigger point for a potential merger is clear.

SpaceX is expanding far beyond the traditional rocket business, particularly into AI infrastructure and computing.

Which raises an uncomfortable question.

If both companies already have enormous projects to fund, would combining them make those ambitions easier to execute — or simply put all the expensive ones on the same balance sheet? ↓

One Big Happy Balance Sheet…

A merger could give Tesla and SpaceX one enormous pool of technology, talent and capital.

It could also give them one enormous collection of headaches.

And neither company is particularly short on ambitious projects.

Take Tesla TSLA ( ▲ 3.55% ) .

For the third quarter, Wall Street expects negative $4.51 billion in free cash flow — the money left after a company pays for its capital investments.

In other words, analysts expect Tesla to spend considerably more cash than its operations generate.

And the spending isn’t slowing down.

→ Expected Q3 capital expenditures: $7.77 billion.
→ Planned 2026 capital expenditures: More than $25 billion.
→ 2025 capital expenditures: Approximately $8.5 billion.

That’s quite a shopping spree. And Tesla isn’t buying office furniture.

The money is going toward AI computing, Optimus robots, Cybercab development and the Terafab chip project.

SpaceX SPCX ( ▲ 6.85% ) , meanwhile, has its own expensive ambitions, from Starship production to orbital data centers.

Combining the companies might help coordinate those investments.
But it wouldn’t make the bills disappear.

Then there’s the regulatory paperwork.

→ SpaceX works on sensitive government, military and intelligence contracts.
→ Tesla operates a major manufacturing business in China.

Putting those operations under one corporate roof could invite additional scrutiny from regulators and government customers.

And investors would have another question to consider.

When two businesses need billions of dollars for competing projects, who gets the money first?

That’s a capital-allocation problem — deciding where a company’s limited resources should go.

→ A merger could make those decisions easier to coordinate.

→ It could also make them harder for shareholders to evaluate.

After all, combining two ambitious companies doesn’t automatically combine their profits, eliminate their risks or make their projects cheaper.

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