Tesla and SpaceX have each set up a special committee of independent directors to study a merger, Elon Musk said on SpaceX’s third-quarter earnings call on Tuesday, October 20 (U.S. time). It’s the first formal step after months of rumor, and Musk didn’t pretend to be neutral about it: “Do I think it would be a good idea? Yes.” He was just as clear that nothing is agreed yet.
What Musk actually said
The question came from an analyst near the end of the call, and Musk opened with a disclaimer: answering it felt like “tap dancing through a minefield.” Then he laid it out. “Both SpaceX and Tesla have formed special committees to discuss this idea at the request of shareholders,” he said, according to the call transcript. The committees are made up of independent directors, and because Musk runs both companies he is a conflicted party and can’t sit in. His description of the setup: “an odd kabuki dance where two groups of people are talking, and I can’t be in the conversation.”
He also tried to cool things down. “I think some people out there assume that a SpaceX and Tesla merger is a certainty. And I think that would be overstating it,” Musk said. The committees “have not reached agreement on the terms of any transaction. And obviously, there’s no guarantee that they will.”
So why does he like the idea? Musk’s list was long: shared work on “super intelligent software, chip design, the Terafab, obviously, robotics, mass to orbit” and connectivity. “There’s a lot of merit to combining the companies as we are pretty much in the super intelligence singularity,” he said. The two already overlap more than most sister companies. They share the Terafab chip project in Texas, and Tesla holds a small SpaceX stake that dates back to its investment in xAI, as Teslarati points out. Last week’s Roadster reveal, with its SpaceX-derived cold-gas thrusters, didn’t exactly calm the speculation either.
The 50% problem
The biggest obstacle Musk named is on the Tesla side. A merger would need “a 50% vote of all shares, not just those who vote, but of all shareholders,” he said, calling it “quite a high hurdle to try to achieve.” That’s not a theoretical worry. Teslarati notes that Tesla’s 2025 proposal to declassify its board got support from only 39.4% of outstanding shares and failed. Musk’s own voting stake is around 20% after he exercised his 2018 options in June, so any deal would need big institutions and a retail base that often doesn’t bother to vote.
Timing is the other question mark. Tesla’s proxy for its December 3 annual meeting, filed Monday, has only three items: re-electing Musk, Robyn Denholm and JB Straubel, a say-on-pay vote and the auditor. (We walked through that ballot in our annual meeting preview.) A merger isn’t on it. Barclays analyst Dan Levy had argued that an announcement would need to come by late October or early November to make that meeting, per Teslarati, so with no terms agreed a vote would more likely need its own special meeting.
Drive Tesla Canada adds an important detail: neither SpaceX’s earnings release nor any Tesla filing mentions the committees, and neither company has named their members or published a proposal. For now, Musk’s words on the webcast are the whole record. At current market values the combined company would be worth roughly $3.5 trillion, by Fortune’s math.
Japan woke up to it, and Tesla reports tonight
The story led Japan’s Wednesday morning business news. NHK ran it at 7:11 a.m. JST, and the Yomiuri Shimbun boiled it down to Musk saying the hurdle is high but the value of putting the two together is big. For Tesla owners here, a merger would mostly be a stock-market story at first. Your Model Y doesn’t care who owns the rockets.
The next chance to hear more is close. Tesla reports Q3 2026 results after the U.S. market closes on Wednesday, with the call at 5:30 PM ET / 2:30 PM PT on Wednesday, October 21 (Thursday, October 22 at 6:30 AM JST), per Not a Tesla App. Deliveries are already known at 486,532, and energy storage came in at 13.7 GWh. Two shareholder questions on Say were already circling this topic before Musk said a word: “What is the ownership structure of Terafab?” and “How are SI assets partitioned between SPCX and TSLA?” Expect the merger to come up again, and expect Musk to tap-dance again, since he still can’t be in the room.
SpaceX shares jumped about 8% after hours on the results, CNBC reported, which we covered in Tuesday’s Stock Watch. Remember when the big merger clue was the two companies following each other on X? That was three days ago.
Lester’s take
I live in Tokyo, so I feel qualified to say this about kabuki: the shows are long, the costumes are elaborate, and the audience usually knows how it ends because they read the program. This one has no program. Two committees are talking in a room Elon isn’t allowed into, which might be the only meeting on Earth he can’t join. As a guy on his fourth Tesla who has paid for FSD four times and is still waiting to use it in Japan, my only request for the special committees is simple: whatever the exchange ratio is, please include FSD approval in Japan as a closing condition. I’m kidding. Mostly.
Sources: SpaceX Q3 2026 earnings call transcript (The Motley Fool), Drive Tesla Canada, Not a Tesla App, Teslarati, SpaceX on X, NHK, Yomiuri Shimbun, CNBC, Fortune.
— Lester Miyashiro, EVX News
Featured image: Starman in Elon Musk’s Tesla Roadster, photographed in space after the Falcon Heavy demo mission in February 2018. Image: SpaceX, via Wikimedia Commons, CC0 1.0 (public domain dedication).