Barclays analyst Dan Levy expects that Musk may announce a merger between Tesla and SpaceX before December, in order to consolidate his artificial intelligence, robotics, and aerospace businesses while strengthening his control over the company.
Barclays believes the most likely scenario is that SpaceX acquires Tesla through a share swap. Based on the current valuations of approximately $2.1 trillion and $1.5 trillion for the two companies respectively, Musk could hold roughly 37% of the new company's equity after the merger but control approximately 56% of the voting power. However, the transaction remains a Barclays scenario projection, and the two parties have not yet announced a formal merger plan.
SpaceX May Acquire Tesla Through Share Swap, Musk's Voting Power Could Rise to 56%
Barclays believes that an all-stock deal with SpaceX as the acquirer is the most likely path to completing the merger, with Tesla shareholders receiving SpaceX shares, and the transaction potentially including a certain acquisition premium. Currently, Musk holds approximately 48% of SpaceX, but through Class B shares with voting rights 10 times that of ordinary shares, he controls about 82% of the company's voting power. In comparison, Musk's stake in Tesla is approximately 20%. Taking into account the tax implications of certain share vesting in 2028, Barclays estimates that his actual ownership could decline to about 17%. If SpaceX acquires Tesla at current valuations, Barclays expects Musk to own approximately 37% of the combined company's equity and 56% of the voting power. Musk has previously stated on multiple occasions that he wishes to hold approximately 25% of Tesla's shares to ensure sufficient influence over the artificial intelligence and robotics businesses. Barclays believes that strengthening control could be an important motivation driving the merger.
Integrating Robotaxi, Optimus, and Grok to Advance AI and Chip Manufacturing in a Unified Manner
Barclays expects that the merger plan will use AI business integration as its primary rationale, combining Tesla's Robotaxi autonomous driving taxis and Optimus humanoid robots with AI projects such as Grok and Macrohard within the SpaceX ecosystem. The two parties may also collaborate on the Terafab chip manufacturing plan. Tesla is building a research and development facility in Austin, Texas, with an investment of approximately $3 billion, and subsequent production plants are expected to require approximately $16.8 billion in investment, which may be jointly funded by both companies. Musk previously noted that Terafab-related decisions require separate approval from both companies' boards of directors, making the process relatively time-consuming. A merger is expected to reduce this coordination obstacle. Other potential synergies include providing Starlink communication services for Tesla vehicles, integrating Grok into Optimus robots, and utilizing Tesla energy storage products to support SpaceX's future space data centers.
Announcement Possible by Year-End, but Shareholder Approval and Massive Capital Expenditure Remain Obstacles
Barclays notes that Tesla's 2026 annual shareholder meeting must be held before December 6, so it is possible that Musk could announce the merger plan before the meeting. However, if the transaction is only announced in late October or early November, the time left for shareholder review may be insufficient. Another scenario is that the two parties independently announce the transaction within the next 6 to 12 months. On the financial side, market forecasts cited by Barclays show that Tesla's free cash flow could reach $12 billion by 2030, while SpaceX is expected to still consume $17 billion. Although a merger could improve financing flexibility, the massive capital expenditures of both parties will also increase funding needs. Additionally, the transaction requires approval from both companies' boards of directors and shareholders, as well as antitrust review. Considering that SpaceX holds U.S. government contracts, Barclays believes the transaction could also involve national security review. Barclays concludes that the increasing overlap between the two businesses makes the merger a scenario worth watching, but the final transaction structure and announcement timing remain uncertain.
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