Prediction: Here's When SpaceX Will Merge With Tesla
Written by Ryan Vanzo for The Motley Fool -> SpaceX plans to go public as soon as tomorrow. Earlier this month, I predicted a merger between Tesla (NASDAQ: TSLA) and SpaceX. The dots were easy to connect. A merger would be complex, I argued, but it would in a single stroke eli
Earlier this month, I predicted a merger between Tesla (NASDAQ: TSLA) and SpaceX. The dots were easy to connect.
A merger would be complex, I argued, but it would in a single stroke eliminate the conflicts of interest shareholders have sometimes leveled at the company because of Elon Musks's interconnected holdings.
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Musk has a long history of intertwining his business operations. Consider that SpaceX currently owns no shares of Tesla. But when you search SpaceX's 370-page initial public offering (IPO) prospectus, Tesla is mentioned more than 80 times. Not only is SpaceX a major buyer of Tesla products -- purchasing everything from its Cybertrucks to its Megapack battery packs -- but both SpaceX and Tesla own a stake in xAI, Musk's artificial intelligence (AI) start-up.
"While a company launching rockets based on contracts with the government may not seem to have a lot in common with an EV manufacturer, both of the businesses are increasingly focused on AI and the talent and computing resources necessary to build AI infrastructure and services," a recent CNBC report noted. "More than three-quarters of SpaceX's $10.1 billion in capital expenditures in the first quarter were tied to AI, and Tesla said in its latest earnings report that capex will roughly triple this year, topping $25 billion."
That same report revealed that SpaceX and Tesla employees are already expecting a merger, likely because their operations are already highly intertwined. "The two companies already have a laundry list of shared resources, and Musk has discussed with colleagues the possibility of folding the companies together," the report concludes.
Only one question remains: When would the merger occur? If the SpaceX IPO is successful, the answer becomes obvious.
I believe the Tesla and SpaceX merger will occur based on two potential timelines.
