Elon Musk said on Tuesday that a merger of Tesla and SpaceX is under active consideration, with special committees at both companies examining the proposal.
"Do I think it would be a good idea? Yes," Musk told financial analysts during a SpaceX quarterly earnings call. He cautioned that shareholders would need to approve any deal and that terms remain unsettled. "The special committees have not reached agreement on terms of any transaction and there's no guarantee that they will," he added.
Tesla carries a valuation near $1.5 trillion. SpaceX, which went public earlier this year, is valued at roughly $2 trillion. A combination would rank among the largest mergers on record.
Musk noted that merging the two firms would align their work on chips, artificial intelligence and software. He described a full merger as making sense given overlapping priorities. He also said he recused himself from the special committees, calling himself a "conflicted party" as chief executive of both companies. He compared even discussing the possibility to "tap dancing through a minefield."
SpaceX shares rose 8% in after-hours trading following the announcement. Tesla shares gained 2% and are scheduled to report quarterly results on Wednesday.
SpaceX's latest earnings show the company generated $7.5 billion from cloud compute capacity, its most profitable unit, and $5.2 billion from Starlink internet services. The company as a whole posted a $1.1 billion loss so far this year.
Musk has consolidated several of his ventures in recent years. SpaceX acquired xAI and X, the platform formerly known as Twitter, before going public. Tesla and SpaceX launched Terafab together to manufacture computer chips. Tesla has also shifted resources toward robotics development.
A Tesla merger would require approval from at least 50% of Tesla shareholders. Musk described that threshold as "quite a high hurdle to achieve," though Tesla investors have backed his interests before. Last year they approved a compensation package for Musk valued around $1 trillion.