Elon Musk SpaceX Tesla merger discussions moved into a formal review as Tesla and Space Exploration Technologies both formed committees to explore the potential merits of a combination. That shifts the idea from a speculative valuation exercise to an internal process, even though the source says a proposal could come in the near future.
Tesla and Space Exploration Technologies
Nearly $3.5 trillion is the combined market value discussed for a merged company, using Space Exploration Technologies' almost $1.9 trillion valuation alongside Tesla's own size. For Elon Musk, that would place electric vehicles, battery packs, rocket launches, satellite internet, and AI under one corporate umbrella.
$14.6 billion in last-quarter revenue for Space Exploration Technologies shows why the comparison is not just about stock-market theater. Revenue rose 161% year over year, while connectivity revenue reached $5.25 billion and AI revenue was $7.56 billion, more than 10-fold higher than a year earlier. The math helps explain why the merger conversation is framed around scale rather than simple overlap.
Over the past 12 months, Tesla generated more than $100 billion in revenue, but its Q3 revenue was little changed year over year and its EV business still accounts for the majority of sales today. That slower top-line profile sits next to Tesla's price-to-sales ratio of 13, its price-to-earnings ratio of 417, and the fact that its earnings have been declining for years now.
Elon Musk's valuation math
Late 2022 marked Tesla's EBIT peak at nearly $15 billion, but by the time of the article that figure had fallen to $3.63 billion. That gap is one reason the merger is being explored rather than treated as a done deal, and it is also why the source describes the combination as highly unlikely to happen over the short time span discussed.
56 is the trailing price-to-sales ratio attached to Space Exploration Technologies, a multiple that signals how much future growth is already embedded in the valuation. If any proposal advances, the committees would have to test whether one corporate structure can justify nearly $3.5 trillion without collapsing the separate economics that currently support each company on its own.
Will Tesla and Space Exploration Technologies actually propose and complete a merger, and on what terms? Until that answer exists, the only concrete change is procedural: Elon Musk has moved both companies into formal committee review, and the market now has to price a possible combination before any terms are on paper.
