Elon Musk calls SpaceX and Tesla merger ‘a good idea’

Elon Musk said Tuesday in Washington that his companies formed committees to review a possible combination. A deal would require formal review and a final vote from shareholders.

The committees have not agreed on transaction terms. They may never do so.

“I think it would be a good idea, but it’s really up to the special committees of both companies,” Musk told investors on a conference call. “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees.”

Both companies established the independent special committees at the request of shareholders. Musk said there is “a lot of merit” to combining the two businesses.

“as we are pretty much in the superintelligence singularity, and there’s a lot to be gained from cooperating on developing superintelligence software, chip design, the Terafab obviously, robotics, mass-to-orbit with the Starmind constellation, connectivity.”

Terafab is a chip manufacturing joint venture between the firms. It should produce its first test chip around May or June next year in Washington. The venture aims to reach volume production.

SpaceX shares went up by over 8 percent Wednesday morning. Tesla shares rose more than 2 percent. Markets responded quickly.

Musk recently drew attention regarding Ukraine. The Ukrainian military faced restricted access to Starshield earlier this month. Starshield serves as the military version of Starlink.

Musk ordered the slowdown, according to U.S. officials and people familiar with the matter. Several Democrats called for an investigation following the report.

Musk posted on X that only Donald Trump could order the slowdown. He noted that SpaceX owns Starlink, but the U.S. government owns and operates Starshield. The disruption impacted Ukrainian drones, airplanes and helicopters.

Special committees evaluate major corporate transactions to protect shareholder interests. Independent directors review proposed combinations and negotiate possible terms. Shareholder votes occur only if both boards recommend approval.

Federal officials review cross-company holdings in Washington before deals close.