Elon Musk on October 20, 2026 openly backed the idea of merging SpaceX and Tesla into a single company. He said the merger was a "good idea" — more precisely, "has a lot of merit" — and confirmed that both companies have formed special committees to explore the deal. Ars Technica reported this. The announcement was brief but substantive: the SpaceX–Tesla merger scenario has now officially moved to the study phase.
The news made waves in two directions in a single day. On one hand, the market reacted immediately: after the announcement, the space company's shares rose 8% in after-hours trading. On the other, Reuters in an analytical explainer estimated the combined company at about $3.5 trillion — a figure that places it in the global ranking roughly between Microsoft and Amazon. So one statement became the center of both market movement and analytical assessment at once.
Special committees: the official study phase
Special committees are a standard mechanism in corporate deals: they evaluate the deal's terms, conduct negotiations with the participation of independent directors, and protect shareholders' interests. The formation of committees means the process has moved to the official study phase — but not that the deal is done or terms agreed.
In practice, this means that inside both companies the possible terms, valuation methodology, and structure of the merger are now being analyzed. The committees examine the financial, legal, and operational aspects of the deal, while independent directors oversee the fairness of the process. This mechanism is especially important in deals involving figures like Musk, who holds major influence in both companies — it serves to reduce conflict-of-interest risk.
So far, no official information has been published about the deal's price, structure, or timeline. Musk's statement only notes that the idea is supported and both sides have begun studying it. The next official announcements are expected once these committees complete their work. In other words, the current stage is the earliest official step on the path from idea to deal — yet this step alone was enough to draw the attention of the market and analysts.
"Superintelligence singularity": Musk's rationale
According to Reuters, Musk explained the reason for the merger this way: combining the two companies "has a lot of merit, because we are pretty much in the superintelligence singularity".
"I do think there's a lot of merit to combining the companies as we are pretty much in the superintelligence singularity", — Musk said (Reuters).
"Superintelligence singularity" is a term Musk uses: the theoretical point at which artificial intelligence (AI) surpasses human intellect and technological development accelerates sharply. In Musk's view, since SpaceX and Tesla operate exactly in this transitional period, combining their resources is logical. His statement presents the deal not as financial but primarily as a strategic necessity — it is about not only joining two companies but concentrating their development directions at a single point.
According to him, the combined company will strengthen cooperation in five areas: superintelligence software, chip design, the Terafab, robotics, and mass-to-orbit via the Starmind network of orbital data centers. Superintelligence software is the foundation of both companies' AI systems; chip design is the foundation of their computing power; Terafab is Tesla's large-scale manufacturing concept; robotics is Tesla's mechanical systems direction; Starmind is mentioned as a project for a network of orbital data centers.
Each of these five areas deserves separate analysis, as they form the central pillars of the merger's logic. Superintelligence software is the common platform on which both companies' AI systems run: if two teams within one company are solving the same type of problem, combining them reduces duplicated work. Chip design is the foundation of computing power: the more powerful AI models become, the more important the chips they run on are, and both companies are working on their own solutions in this field. Terafab is Tesla's large-scale manufacturing concept: the experience of producing millions of devices could also be applied to SpaceX's growing manufacturing needs. Robotics is Tesla's mechanical systems direction: experience in building and controlling robots is also relevant for space infrastructure. Starmind is the orbital data center network project: the idea of placing data centers in Earth orbit combines SpaceX's rockets and Starlink experience with Tesla's computing needs.
$3.5 trillion: between Microsoft and Amazon
According to Reuters, a combined SpaceX–Tesla would become one of the most valuable companies in the world — its estimated value would be about $3.5 trillion. This figure places it in the global ranking roughly between Microsoft and Amazon. This is exactly the estimate given in the Reuters explainer.
An estimated value of $3.5 trillion means that if the deal goes through, it could rank among the largest corporate deals in technology history. For now, this is only analysts' estimate, not the official deal price. The estimate itself was given at a time when the deal is not yet formalized, so it reflects the price the market assigns to the idea: investors and analysts, factoring in the probability of the merger, are estimating the future combined value of both companies.
The announcement found an immediate echo in the market: after the news, the space company's shares rose 8% in after-hours trading. After-hours trading is the interval that continues even after the exchange closes, and movement in it shows investors' rapid reaction to news. An eight-percent rise indicates the market's positive attitude toward the idea, although the deal itself is not yet certain. Such a sharp move usually happens when news is unexpected — meaning the market took this idea as a serious probability.
The line between the two companies is blurring
Reuters notes that in recent years the boundaries between SpaceX and Tesla have increasingly blurred. Musk is expanding activity in five directions: artificial intelligence, robotics, advanced manufacturing, satellite communications, and computing infrastructure — including data centers on Earth and, in the future, in orbit.
Each of these directions exists in both companies. Tesla today is not only an electric vehicle maker: the company works on robotics, AI chips, and software. SpaceX is developing space infrastructure — satellite communications, Starship rockets, and now orbital computing projects. AI software, chip design, and data centers are the three intersection points of both companies.
Musk cited exactly this convergence as the main argument for the merger. By his logic, it is more efficient to combine two increasingly similar structures under single management than to keep them separate. This argument presents the merger not only as a financial deal but as an operational necessity: if two companies are solving the same engineering problems, combining their resources reduces duplication and accelerates development.
Obstacles: shareholder votes and regulatory risks
The merger is not certain. Reuters recalls that for the deal to go through, each company's shareholders must vote separately, and Musk faces substantial regulatory risks. This is also covered in a separate Reuters piece.
Shareholder votes are a mandatory stage of corporate deals: the owners of both sides must approve the deal's terms. Voting dates have not been announced yet — they will be set after the committees complete their study. The outcome of this stage is not known in advance: shareholders may find the deal's terms insufficient or the valuation unfair and vote against. That is why the committees' work must prepare not only the technical aspects of the deal but also the arguments needed to convince shareholders.
The regulatory side is more complex. A technology merger of this scale usually attracts the attention of antitrust authorities, and government contracts in the space and automotive industries become grounds for additional scrutiny. Reuters assessed exactly these risks as "substantial". Government contracts in the space sector, safety standards in the automotive sector — each direction draws its own regulators, and each of them may impose its own conditions on the deal. Therefore, the formation of committees is the beginning of the process, not its end: the deal's terms, valuation methodology, and timelines are still unknown.
Next steps
Attention is now focused on three points: the special committees' conclusions, the shareholder voting dates, and the regulators' stance. Each of these stages will determine the deal's fate, and their results will be announced officially.
The committees' conclusions will define the deal's possible terms and valuation framework — this will be the first concrete document. The shareholder vote will show whether the deal is politically approved. The regulators' stance will determine whether the deal is legally possible. Only if all three stages succeed will the merger become reality.
This news is also relevant for Uzbek readers following the AI field: at the center of the merger idea are AI software, chip design, and orbital data centers — that is, the three most actively developing directions of the industry. If the deal goes through, it will directly affect how AI infrastructure is built — from chips to the data centers they run on.
