Musk backs $3.5 trillion Tesla-SpaceX merger, citing AI and robotics gains

Elon Musk publicly endorsed a potential $3.5 trillion merger between Tesla and SpaceX on Tuesday, aiming to create a single integrated company spanning AI, robotics, satellites, and energy, though significant regulatory and governance hurdles remain. Musk argued that combining the companies would simplify decision-making and enable closer cooperation on superintelligence software, chip design, robotics, and orbital data centers. Tesla shareholders would gain access to SpaceX's Starlink and launch businesses, while SpaceX investors would gain ownership of Tesla's vehicles, energy storage, and autonomous driving operations. The merger faces major risks, including heightened scrutiny from US national-security officials due to SpaceX's military contracts and Tesla's deep ties to China. Shareholder approval, conflicts of interest, and execution challenges across expensive ventures like Starship and robotaxis also pose substantial obstacles.