According to ARK Invest CEO Cathie Wood, Elon Musk’s SpaceX and Tesla ventures will “ultimately Combine” into the most powerful AI company in the world. Wood highlights Robotaxis, orbital data centers, Optimus robotics, and SpaceX AI (formerly known as xAI) as “multi-trillion dollar opportunities.” Let’s discuss if it is actually possible.
Will Tesla SpaceX Merge Into One Big Company?
Wood’s comment on a potential SpaceX and Tesla merger is not the first instance of the possibility being discussed. Musk himself has reportedly discussed a potential merger with insiders. A CNBC report from May 2026 also highlighted the matter. One Tesla employee had spoken to CNBC and stated that many within the company felt that such a transition would eventually occur.
Both Tesla and SpaceX have a host of shared resources. The two companies have often worked together in times of power and compute constraints. Other collaborations include sale of solar equipment and car parts from Tesla to SpaceX. Tesla has also used SpaceX private jets, and relied on the company to develop a special alloy for its Cybertruck. Both companies also have shared board members, including Elon Musk.
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AI may be the biggest factor that brings Tesla and SpaceX together. Both companies rely heavily on AI and xAI eventually became a part of SpaceX earlier this year. According to Tomasz Tunguz, a former engineer who’s now a venture capitalist at Theory Ventures, “Tesla has to run powerful AI systems inside a moving vehicle with tight limits on power, cooling, latency, reliability and cost. SpaceX has to think about compute in orbit, where radiation, thermal cycling, launch mass, power generation and heat rejection all become existential design constraints.“
However, a merger between Tesla and SpaceX would come with its own challenges. Questions about which company would be the parent and how a stock swap would take place may pose challenging.