Why does Elon Musk want to merge Tesla and SpaceX?

Elon Musk has gone from running Tesla and SpaceX side by side to openly floating a merger between them. Asked on Tuesday if it would be a good idea, he answered yes. He also said special committees are already looking at the idea, though he stressed that nothing has been agreed and there is no guarantee it happens.

If it did, the numbers would be huge. Tesla is valued at roughly $1.5tn, while SpaceX is at $2tn. Put them together and you get what would be the biggest merger ever. Musk said he sees “a lot to be gained” from combining the two companies, but any deal would still need shareholder approval.

The logic is pretty clear from Musk’s point of view. Tesla brings cars, robots and self-driving tech. SpaceX brings rockets, data centres, satellites and telecoms. Musk has said both companies work on chips, AI and other advanced projects, and he sees value in pulling those efforts into one structure. That also fits neatly with his broader push to consolidate his businesses, after SpaceX acquired xAI and X, formerly Twitter, before going public this year.

Customers probably wouldn’t see an immediate shake-up. Experts told the BBC that Tesla drivers are unlikely to notice much near term, even though the deal could put more weight behind combining Tesla’s self-driving and robotics work with SpaceX’s AI and satellite network. The recent Roadster reveal, with SpaceX rocket thrusters attached to an electric car, looked to some like a signal of where this is headed.

There’s still a catch, and it’s a big one: Tesla shareholders would have to back it, with half needed for approval. Musk called that a “quite a high hurdle,” though he cannot take part in shareholder discussions. Still, analysts quoted by the BBC think shareholders may go along, even if it leaves them holding a smaller slice of a much larger, messier company. The real winner, as ever, may be Musk — because one stock is easier to steer than two.