SpaceX Valuation Surge Makes Tesla Merger More Likely
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- SpaceX shares jumped 37% to $185 by June 18, lifting its valuation to $2.44 trillion, up from a pre-trading $1.75 trillion, drastically improving its ability to acquire Tesla in an all-stock deal.
- Gwynne Shotwell, SpaceX president and COO, did not rule out acquiring Tesla in a June 12 CNBC interview, suggesting the tie-up could align with long-term convergence goals and simplify Elon Musk’s responsibilities.
- Tesla posted just $3.4 billion in GAAP net earnings over the past four quarters—down from $15 billion in 2023—while maintaining a $1.5 trillion market cap based largely on unproven future AI and robotics promises.
- SpaceX could now buy Tesla by issuing only 38% of its shares, down from a required 46% before its trading debut, reducing dilution pressure on SpaceX shareholders despite the still-uneconomic fundamentals of the combined entity.
- Elon Musk has already folded xAI into SpaceX and owns both companies, creating structural synergies including joint compute hardware development at Terafab and Tesla’s $4 billion stake in SpaceX via xAI.
- The combined SpaceX-Tesla entity would have a $4 trillion market cap—ranking fourth in the U.S.—but would be uniquely unprofitable, as SpaceX’s losses exceed Tesla’s minimal earnings, making it an outlier among top-valued firms.
Why it matters: SpaceX shareholders would see ownership drop from 100% to under two-thirds in a merger, exchanging overvalued stock for Tesla’s weak earnings and speculative portfolio. The deal only looks viable because inflated valuations decouple from fundamentals, benefiting Musk and Tesla investors at SpaceX’s expense.
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