Elon Musk has reopened a question investors have kicked around for years: why keep Tesla and SpaceX separate if more of their technology is beginning to converge?
During the September 15 All-In Podcast, Musk joined SpaceX President Gwynne Shotwell for a discussion that explicitly included Terafab and the possibility of combining the two companies. Tesla, Inc. (NASDAQ:TSLA) and Space Exploration Technologies Corp. (NASDAQ:SPCX) already share Musk, engineering talent and a growing interest in AI infrastructure. The new ingredient is Terafab, the semiconductor manufacturing project intended to reduce dependence on outside chip supply.
The merger question is no longer purely philosophical
A combined company could theoretically connect Tesla’s autonomous-driving, robotics and manufacturing ambitions with SpaceX’s rockets, satellites, communications network and rapidly expanding AI infrastructure. Terafab gives that overlap a physical center. If both companies eventually need enormous quantities of specialized compute hardware, semiconductor capacity becomes a shared strategic problem rather than two unrelated procurement decisions.
That is the strongest argument for Tesla, Inc.. Tesla is spending heavily on AI, robotaxis and Optimus while automotive margins remain under pressure. Shared infrastructure could spread some development costs across a larger technology platform. The problem is that no merger has been announced. Combining two enormous companies would also create valuation, governance and capital-allocation questions that dwarf the theoretical synergies.
Space Exploration Technologies Corp. has an equally complicated setup. SpaceX has a profitable Starlink business, a leading launch franchise and growing AI infrastructure exposure, but merging with Tesla could tie those businesses to a much more cyclical auto manufacturer. Shareholders might prefer SpaceX’s cleaner aerospace, communications and compute story.
Professional investors entered the setup differently
Insider Monkey’s database showed 116 hedge funds holding Tesla in Q2 2026, down from 123 in Q1. BAMCO held roughly 12.5 million shares after increasing its stake about 5%. SpaceX only began public trading in June, so there is no comparable Q1 public-stock holder count. Its Q2 filings instead provide the first post-IPO institutional baseline, with several large technology-focused funds reporting substantial positions.
Tesla’s August 31 short-interest snapshot was also relatively restrained at roughly 74.2 million shares, about 2.35% of public float and two days of average trading volume.
The interesting part is not whether Musk has secretly decided to merge the companies. There is no evidence of that. It is that Tesla and SpaceX increasingly have strategic assets that make the old question less absurd. Terafab may be the clearest example yet.
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