Tesla and SpaceX Form Committees to Study $3.5T Merger

Tesla and SpaceX boards formed special committees on October 20, 2026, to study a combination worth about $3.5 trillion. Musk is recused from the talks.

Musk told investors that "some people out there assume that a SpaceX and Tesla merger is a certainty," and called that overstating it. He also described his position as "an odd kabuki dance" in which he cannot join the conversation. The filing language matters more than the commentary. A SpaceX 10-Q filed October 22 says any combination with Tesla would need approval from its special committee, its board, and its controlling shareholder.

 Musk holds roughly 85% of SpaceX's voting power, so that last approval is effectively his. The deal's path therefore runs through both the independent process and Musk himself. The steps that would signal real progress are committee advisers and timelines being published, and the controlling-shareholder approval being formally sought. That is my reading rather than a reported finding. Decrypt 

Why Governance Is the Central Question

SpaceX uses the "controlled company" exemption, which lets it skip a majority-independent board and independent nominating and compensation committees. Only Class B holders can remove Musk as CEO, chairman, or director.

Musk's potential upside is also large: SpaceX's board set aside 1 billion super-voting shares for him that vest only if the company reaches market-value milestones of up to $7.5 trillion and establishes a permanent human colony on Mars with at least one million inhabitants. Fortune

SpaceX's listing gives the talks their backdrop. The company went public on Nasdaq under the ticker SPCX at a target valuation of about $1.77 trillion, the largest IPO on record, and it reached about $2.1 trillion on its first trading day. In February 2026 it had also absorbed Musk's AI company xAI. Its shares later fell roughly 50% from their post-IPO peak by late July, a drop that cost Musk his trillionaire status. Those movements explain why the valuation gap between the two companies matters to any merger discussion. Wikipedia