SpaceX filed paperwork on May 21 to become a public company, potentially setting a record for IPO size [1]. The filing reignited speculation that SpaceX will merge with Tesla, a possibility Wedbush analyst Dan Ives predicts could occur by 2027 [1, 2, 3, 4]. Elon Musk, CEO of both companies, aims to consolidate his control over the AI ecosystem by combining SpaceX and Tesla [1, 2, 3, 4].
Market platform Kalshi currently estimates a 33% chance the merger will happen before May 2027, though this probability has experienced notable fluctuations [1, 2, 3, 4]. The two firms are already linked through a joint project to build the Terafab semiconductor fabrication plant in East Texas, with an investment expected to reach as high as $119 billion according to U.S. sources; some Chinese reports show a figure of 1,190 billion USD, likely a formatting issue equivalent to $119 billion [1, 2, 3, 4].
Musk addressed complexities involved in cooperating between SpaceX and Tesla on Terafab and related board approvals. He said, “SpaceX is going to take care of the initial phase of the scaled up Terafab. Any kind of intercompany thing has to be approved by both the SpaceX and Tesla board of directors. It's going to have a lot of, unfortunately, a lot of complexity because we've got to make sure Tesla shareholders are served and SpaceX shareholders are served, and strike the right balance there” [1].
SpaceX also owns the AI company xAI, reflecting Musk’s ambitions in artificial intelligence [1, 2, 3, 4]. Biographer Walter Isaacson said in April 2026 that “马斯克一直让工程师在他的公司之间流动，我认为他想把这些公司变成一家大企业,” meaning Musk frequently moves engineers among his companies with the goal of unifying them into a single enterprise [1, 2, 3, 4].
Tesla has faced growing competition in the electric vehicle market. In April 2026, Tesla's EV sales in China fell behind local rivals BYD, Geely, and Chery [1, 2, 3, 4]. BYD surpassed Tesla last year to become the world's largest pure electric vehicle brand [1, 2, 3, 4].
The SpaceX IPO filing has brought merger speculation into focus as Musk attempts to optimize synergies amid competitive pressures. The next major milestone will be SpaceX’s public offering and subsequent shareholder discussions about a potential merger with Tesla, expected before May 2027 if the prediction holds [1, 2, 3, 4].
