Elon Musk’s SpaceX, Tesla, and xAI are reportedly in talks to merge

Three of Elon Musk’s companies — SpaceX, xAI, and Tesla — are vying for a potential merger. While the talks appear to be at an early stage, according to reports from Bloomberg and Reuters, they could eventually lead to at least one company joining SpaceX.

Two scenarios are being broken down. In one, SpaceX and Tesla will merge, according to Bloomberg, citing unnamed insiders. In another case, SpaceX and aXI (which already owns Musk’s social media platform X) will merge.

According to Reuters reports, the merger between SpaceX and xAI could happen before SpaceX’s planned IPO this year. This would bring products like the Grok chatbot, the X platform, Starlink satellites and SpaceX rockets together under one company.

Representatives for SpaceX and xAI have not discussed this possibility publicly. However, recent filings show that two new corporate entities were created in Nevada on January 21, called K2 Merger Sub Inc. and K2 Merger Sub 2 LLC. This indicates that Musk is keeping all options open.

There are positives in either scenario. Combining SpaceX and xAI could allow xAI to put its own data centers in space, something Musk has said he wants. A tie-up between SpaceX and Tesla could align the electric car maker’s energy storage business with the data center in-space idea as well.

Both options — as well as a combination of the three companies — are in line with Musk’s comments and recent actions to unify them, or at least share resources, among them. Last year, SpaceX agreed to invest $2 billion in cutting-edge AI, according to the Wall Street Journal, and earlier this week, Tesla (also led by Musk) revealed it had also invested $2 billion in the AI ​​startup.

Last year, xAI bought X in a deal that Musk said valued xAI at $80 billion and X at $33 billion. SpaceX, which has been around since 2002, has reportedly launched a secondary sale that values ​​it at $800 billion, making it the most valuable private company in the United States.

A recent Financial Times report indicated that Musk wants to take SpaceX public in June. But then again, Musk’s grand plans rarely happen on time.

This article was originally published at 10:30 a.m. PT. It has since been updated with new information about Tesla.