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Why is Elon Musk plotting a mega-merger of SpaceX and Tesla?
Elon Musk considers a merger of SpaceX and Tesla to combine their AI, chip, and technology projects.
Key points
- A merger would combine Tesla's cars and robots with SpaceX's rockets, satellites, and data centres.
- Tesla reported third quarter sales of $28.05 billion, a slight drop from $28.1 billion in the previous year.
- The deal would require the backing of half of Tesla's shareholders to be approved.
Why it matters. The merger could be a step toward Musk's mission to build a self-sustaining city on Mars by consolidating his technology and aerospace operations.
Elon Musk stated that combining Tesla and SpaceX would be beneficial due to their shared work on AI, chips, and other technology projects. While David Nicholson of The Futurum Group believes a merger is likely, Musk noted that calling it a certainty would be overstating things. The deal would require approval from at least half of Tesla's shareholders, which Musk described as a high hurdle.
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Why is Elon Musk plotting a mega-merger of SpaceX and Tesla?
Musk says there's "a lot to be gained" by combining the firms in what would be the biggest merger in history. "In my opinion, 100%. It's just a question of when," says David Nicholson, chief technology advisor at market research firm The Futurum Group. During Tesla's earnings call on Wednesday, Musk said he had nothing further to add about the prospect of a merger but quipped: "I feel like I'm tap-dancing through a minefield." Musk said that calling the merger a certainty would be "overstating" things. Tesla reported a slight drop in third quarter sales which came in at $28.05 billion compared with $28.1 billion at the same time last year. The unveiling of the Tesla Roadster last week - a futuristic electric car powered by SpaceX rocket thrusters - served as a "symbolic embodiment" hinting at the two Musk companies merging, Nicholson said. Musk, chief executive of both SpaceX and Tesla, said bringing the firms together would be beneficial given the work each does around chips, artificial intelligence (AI) and other technology projects. Specifically, the deal would combine Tesla's cars, robots and self-driving technology with SpaceX's rockets, data centres, satellites and telecommunications operations. The move could be a step towards Musk's mission to build a self-sustaining city on Mars - a vision that has invited sceptics but also plenty of backers. Over the past year, Musk h.
Elon Musk confirms Tesla and SpaceX merger is under consideration
Elon Musk confirmed on Tuesday that he is actively considering merging Tesla and SpaceX, his two biggest companies. Speaking during a call with financial analysts to discuss SpaceX's latest results, Musk said he believes a merger would be a good idea. He cautioned that a deal cannot be assumed and would require shareholder support. Special committees within both companies have been formed to examine the possibility of a mega-merger.