Hajra Naz
Elon Musk may be preparing to bring some of his biggest companies closer together. According to reports from Bloomberg and Reuters, early-stage discussions are underway that could involve a merger between SpaceX, xAI, and possibly Tesla.
So far, two main options are being considered. One scenario would combine SpaceX and Tesla, according to Bloomberg, citing people familiar with the talks. Another would merge SpaceX with xAI, Musk’s artificial intelligence company that already owns the social media platform X.
Reuters reports that a SpaceX–xAI merger could happen ahead of a planned SpaceX IPO, potentially as soon as this year. If that deal moved forward, it would place products like the Grok chatbot, X, Starlink, and SpaceX’s rocket business under a single corporate structure.
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Neither SpaceX nor xAI has commented publicly on the reported discussions. However, recent regulatory filings suggest preparations may be underway. On January 21, two new entities, K2 Merger Sub Inc. and K2 Merger Sub 2 LLC, were registered in Nevada, signaling that Musk is keeping multiple merger paths open.
Each option carries strategic benefits. A merger between SpaceX and xAI could support Musk’s long-term vision of placing AI data centers in space, an idea he has previously floated. A SpaceX–Tesla combination could align Tesla’s energy storage and infrastructure business with those same ambitions.
All of these possibilities fit Musk’s broader pattern of consolidating resources across his companies. Last year, SpaceX agreed to invest $2 billion in xAI, according to The Wall Street Journal. Earlier this week, Tesla disclosed its own $2 billion investment in the AI startup.
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That consolidation trend accelerated in 2024, when xAI acquired X in a deal Musk said valued xAI at $80 billion and X at $33 billion. SpaceX, founded in 2002, has since surged in valuation, with a recent secondary sale reportedly pricing the company at $800 billion, making it the most valuable private company in the U.S.
A recent Financial Times report suggests Musk is targeting June for a SpaceX public offering. Still, given Musk’s history of shifting timelines, the exact timing and structure of any merger or IPO remain uncertain.
