Musk weighs merging Tesla and SpaceX⁠.

Elon Musk has said he is actively considering merging Tesla and SpaceX, his two biggest companies¹. Speaking on a call with analysts about SpaceX's latest results on Tuesday, he said special committees at both companies had been formed to examine the idea¹. "Do I think it would be a good idea? Yes," he said¹. He added that the committees had not agreed terms and that there was no guarantee they would¹.

With Tesla valued at roughly $1.5 trillion (£1.1 trillion) and SpaceX at $2 trillion, a combination would be the largest merger ever². Musk said a deal was not a certainty and compared even talking about it to "tap dancing through a minefield"³. He described himself as a "conflicted party" who cannot take part in the committees' discussions³. On the Tesla side, a deal would need the backing of 50 per cent of all shares, not just those that vote, which he called "quite a high hurdle"³.

SpaceX's revenue for the three months to 30 September reached $14.58bn, against the $12.72bn Wall Street expected, and net profit was $4.4bn⁴. Its AI revenue rose more than ninefold to $7.6bn, earned chiefly by leasing data centre capacity to outside developers such as Anthropic, Google and Reflection AI⁴. Starlink brought in $5.25bn³. AI also took $16.4bn of the company's $19.6bn capital spending⁴.

Musk said a merger would make sense for the work each company does on chips, AI and software¹. Before going public this year, SpaceX acquired xAI and X, and the two companies recently launched Terafab, a joint effort to make computer chips¹. A deal would put Tesla's cars, robots and self-driving technology together with SpaceX's rockets, data centres and satellites². Musk also pointed to Starmind, a space-based AI data centre SpaceX is developing³.

One investment analyst told the BBC that Tesla shareholders would likely hold "a smaller slice of a much larger and more complex business"². A merger would also give Musk greater voting control over the combined company than he has at Tesla, a point the committees would have to weigh². SpaceX as a whole is still not profitable over the first nine months of the year, despite revenue of $27bn, up from $13.7bn¹.

Who owns your AI's computers

The sources give no British angle: no UK regulator has spoken and no UK business is named. The part worth your attention is the quieter one. SpaceX now makes more from renting computing power to AI firms than from its satellites, so the companies behind tools many offices use are, in part, Musk's customers. A merger would fold that business into a company that also builds cars and robots, with one man holding more of the votes than he does today.

Nothing is agreed, and Musk himself calls the bar high. We would not change a supplier on the strength of an earnings call. But if you are choosing an AI provider this winter, it is fair to ask where its computing comes from and who owns it, and to write the answer down. Concentration is a risk you can note long before it becomes one you have to manage.

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