Tesla and SpaceX Boards Form Special Committees to Review a Possible Merger

The Short Version

• TechCrunch reported that the boards of SpaceX and Tesla have each formed special committees of independent directors to review a possible merger, created at shareholders' request, according to Elon Musk on SpaceX's Q3 earnings call on Tuesday, October 20.
• Musk says he supports the idea but cannot take part in the committee discussions because he is a conflicted party — and he warned that assuming a merger is a certainty would be overstating it. The committees have not reached agreement on terms of any transaction.
• A Tesla deal would need support from 50% of all outstanding Tesla shares, not just votes cast, Musk said. A SpaceX vote would be easier, because Musk holds more than 50% voting power following SpaceX's IPO.
• The disclosure landed on a huge earnings day: CoinDesk reported SpaceX Q3 revenue of $14.58 billion, well ahead of the $12.7 billion consensus, with shares jumping about 9% in premarket trading Wednesday. Tesla reports its own Q3 results after Wednesday's close.

There is a particular kind of corporate drama that only Elon Musk seems able to produce: two enormous companies, one man running both of them, and a merger process that has to be designed, from the start, to keep that man out of the room. That is now formally underway. TechCrunch reported that the boards of SpaceX and Tesla have each formed special committees of independent directors to review a possible merger of the two companies. The committees were created at shareholders' request, according to Musk, who disclosed their existence on SpaceX's third-quarter earnings call on Tuesday, October 20.

Musk did not dance around his own position in the process. He named it, plainly, and then described the strange choreography it creates. "Because I'm a conflicted party, I can't actually be in the discussions of the special committees," he said, in remarks reported by TechCrunch. He called the setup "an odd kabuki dance where two groups of people are talking, and I can't be in the conversation." It is a remarkable sentence to hear from the chief executive of both companies at once — and it is also, governance experts would say, exactly how a transaction like this is supposed to work when the same person sits on both sides of the table.

Supportive, but at arm's length — and far from certain

Musk said he supports the idea of combining the companies. He was equally clear, in the same breath, that support is not the same as a deal. "I think some people out there assume that a SpaceX and Tesla [merger] is a certainty, and I think that would be overstating it," he said, according to TechCrunch. The committees, he added, have not reached agreement on terms of any transaction. That distinction matters. A special committee is not a rubber stamp with better stationery; it is a body of independent directors empowered to evaluate a proposal, hire its own advisers, and — crucially — say no. Forming the committees starts a formal review. It does not finish one.

The voting math, as Musk laid it out, cuts in two very different directions. On the Tesla side, he said, a deal would need support from 50% of all outstanding Tesla shares — not merely a majority of the votes actually cast. That is a meaningfully higher hurdle than the standard shareholder vote, because every abstention and every unreturned ballot effectively counts against the deal. Tesla's shareholder base is famously broad and famously retail-heavy, and getting half of every share in existence to affirmatively line up behind the largest merger in history would be a campaign in itself. On the SpaceX side, by contrast, Musk said the vote would be easier: he holds more than 50% voting power following SpaceX's initial public offering, which means the outcome there is, practically speaking, his to decide — even if he cannot sit in on the committee's deliberations.

Why combine at all? AI, robots, orbit — and chips

Musk's stated rationale, as reported by TechCrunch, is a convergence argument. He pointed to merit in combining the companies around AI software and robotics — the two fields where Tesla's work on autonomous systems and humanoid robots increasingly overlaps with SpaceX's ambitions. He cited Starmind, SpaceX's orbital AI data center project, which would put computing power in orbit rather than in power-hungry facilities on the ground. And he cited Terafab, the joint Tesla-SpaceX chip project — a venture the two companies are already pursuing together, and the kind of shared infrastructure that makes the corporate boundary between them look, to Musk, increasingly artificial.

There is already a financial thread tying the companies together, too. As Fortune's reporting, carried by AIStockWire, has noted, Tesla already holds SpaceX shares through its roughly $2 billion xAI investment, completed on March 12, 2026. In other words, Tesla shareholders already own an indirect slice of SpaceX. A full merger would turn that toehold into the whole position — and would fold a rocket company, a satellite network, an orbital computing project and a chip venture into the same balance sheet as the world's most valuable carmaker.

The scale is difficult to overstate. Fortune's figures, reported via AIStockWire, put the combined market value of the two companies at roughly $3.5 trillion at Tuesday's closes — SpaceX at about $2 trillion and Tesla at about $1.5 trillion. A combination would create, by a wide margin, the most valuable company on Earth, and it would do so by merging two businesses whose shared assets are, at this point, mostly a chief executive, a chip project and a growing pile of AI ambition.

The earnings backdrop: SpaceX just blew the doors off

The merger disclosure did not arrive in a vacuum. It arrived on top of a quarter that reminded everyone why SpaceX's value has climbed so fast. CoinDesk reported that SpaceX posted third-quarter revenue of $14.58 billion, comfortably beating the $12.7 billion consensus estimate, with earnings per share of 35 cents against a forecast of 15 cents. SpaceX shares jumped about 9% in premarket trading on Wednesday, to around $161. Fortune's reporting added the year-over-year picture: revenue up 161% from a year earlier, and net income of $4.4 billion, against a $1.1 billion loss in the same quarter a year ago. We covered the full earnings picture in our earlier story on SpaceX's Q3 results.

Tesla's turn comes next, and quickly. CoinDesk noted that Tesla reports its own third-quarter results after Wednesday's close, with analysts forecasting roughly $28.13 billion in revenue and 44 cents in adjusted earnings per share. That sequencing gives Wednesday a strange symmetry: in the morning, investors price a rocket company that just doubled expectations; by the evening, they will be reading the numbers of the car company whose shareholders are now being asked — formally, through their independent directors — to consider becoming one company with it.

Who would decide? The independent directors

Because the whole point of a special committee is independence, the names around the table matter — and here, Musk was careful about what he did and did not say. According to TechCrunch, drawing on Tesla's October 19 proxy filing, Tesla's independent directors are chair Robyn Denholm, Ira Ehrenpreis, JB Straubel, Joe Gebbia, Jack Hartung, James Murdoch and Kathleen Wilson-Thompson. SpaceX's independent directors, TechCrunch reported, include Ehrenpreis — who, notably, sits on both boards — along with Randy Glein, Donald Harrison, Steve Jurvetson, Luke Nosek and Roelof Botha. Musk did not name the members of either special committee, so it is not yet public which of those directors are doing the actual reviewing, or whether Ehrenpreis, the one director common to both lists, is involved on either side.

That overlap is the sort of detail the committees themselves will have to manage carefully, because the credibility of this process is the process. If Tesla's independent directors conclude a merger serves Tesla shareholders, and SpaceX's conclude the same for theirs, the two committees will eventually have to meet on price and terms — the moment where a shared vision stops being a vision and becomes an exchange ratio. Nothing in Tuesday's disclosure suggests that moment is close. What Tuesday established is narrower and, in its way, more consequential: the question is no longer whether the boards are thinking about a merger. They have built the machinery to decide.

What happens next

For now, the calendar belongs to the committees and to Tesla's earnings call. Investors will listen to Tesla's Wednesday report with the merger hanging over every answer, and the broader market is already moving on the week's news — as we reported in our look at how Asian markets rebounded on Wednesday. CNBC and other outlets are expected to press both companies for a timeline, but on the record as it stands, there is none: no terms, no agreement, no certainty — Musk said so himself. There are only two committees, two sets of independent directors, and a chief executive describing, with unusual candor, a dance he is not allowed to join. Whether the music ever starts is now, formally, somebody else's decision. That may be the most interesting part of the whole story.