Daniel Mercer
Elon Musk has announced that Tesla and SpaceX are actively considering a monumental merger that could reshape the corporate landscape. This strategic move aims to consolidate Musk’s corporate influence into a single powerhouse, potentially unlocking a compensation package estimated at around $1 trillion. a report from Bloomberg, citing anonymous sources, suggests that Musk or his associates believe there is urgency to finalize the merger before the end of Donald Trump’s presidential term.
Neither Tesla nor SpaceX responded to Bloomberg’s inquiries regarding this perceived urgency. They also did not reply to Gizmodo’s questions related to the same issue.
It’s important to note Bloomberg’s specific wording, which is somewhat vague:
“With Trump approaching the second half of his final term and jittery markets threatening the exuberance underpinning Musk’s empire, there’s a push to announce a deal by the first half of 2027 so that it closes during this administration, according to people familiar with the matter.”
While concerns about Democrats potentially affecting market stability could pose challenges, the main obstacle to this merger appears to be antitrust issues. The proposed entity, possibly called Spacesla, would merge two companies with intertwined AI interests. Both companies are investors in the Terafab AI chip plant, and Tesla previously invested in xAI before it came under SpaceX’s ownership. The critical question remains: do regulators view these companies as competitors in the AI space whose merger might disadvantage customers?
Conversely, a recent article from Politico suggests additional reasons, aside from antitrust concerns, that could complicate this merger if Democrats gain more influence. Reports indicate that they are eager to challenge Musk if they secure control of at least one chamber of Congress in the upcoming midterms. Possible conflicts related to SpaceX and Tesla, along with Musk’s budget cuts during the DOGE era, are reportedly on their radar.
On Wednesday, Musk reacted to the Politico article on X with a message that seemed almost confrontational. He stated, “Live by the sword, die by the sword,” and added, “Those who pick fights with me should understand that I will find out who is really pulling the strings and come for them, not just their puppets.”
Live by the sword, die by the sword.
Those who pick fights with me should understand that I will find out who is really pulling the strings and come for them, not just their puppets … https://t.co/L7xNa6yCm0
— Elon Musk (@elonmusk) October 21, 2026
According to a research memo from JPMorgan reviewed by Benzinga, one area of concern that Democrats, or any political rivals, might exploit is Tesla’s significant operations in China. This market contributes approximately 20% of Tesla’s revenue. If Tesla merges with SpaceX—a prominent defense contractor operating Starlink, which is prohibited in China—this could pose substantial regulatory challenges. JPMorgan proposes that Tesla’s operations in China could be transferred to a consortium of Chinese firms, a strategy reminiscent of TikTok’s arrangement in the U.S.
The insights from Bloomberg’s anonymous sources may reveal more than they intended. By not clearly outlining the vulnerabilities that Democrats could target, it seems Musk is wary that they may attempt to obstruct his goals—whatever those may be. This raises questions about the extent of Musk’s desire for this merger.
Ethan Carter
