Musk weighs combining Tesla and SpaceX
Elon Musk confirms he is considering merging Tesla and SpaceX
Wednesday, 21 October 2026
Warm-up
- What risks and benefits can a big corporate merger create?
- When should a founder step back from a decision?
- How do share prices react to major announcements?
Vocabulary
- merger
- the joining of two companies to form one business
- shareholder
- a person or organisation that owns shares in a company
- committee
- a small group chosen to study an issue and make recommendations
- valuation
- an estimate of how much a company is worth in money terms
- scrutiny
- careful and critical examination by the public or authorities
- revenue
- money a company earns from its business activities
- profitable
- making more money than it spends; producing a profit
- approval
- official agreement to a plan or decision
Reading
Listen to this story
British EnglishElon Musk said he is considering a merger of Tesla and SpaceX, and special committees at both companies are examining it. He called himself a 'conflicted party' and stressed that any deal would require shareholder approval. The committees have not agreed terms, and a merger is not guaranteed.
By valuation, Tesla is about $1.5 trillion and SpaceX $2 trillion, so a deal would be among the largest. After Musk's remarks, SpaceX shares rose 8% after-hours, while Tesla gained 2%.
SpaceX builds rockets and the Starlink satellite network, and its Starshield service is under scrutiny over alleged limits on Ukraine's access. Meanwhile, Starlink reported revenue of $5.2bn in the three months to 30 September, up from $3bn a year earlier. In the first nine months, SpaceX revenue rose to $27bn, yet it was not profitable overall, posting a $1.1bn loss; it made $4.4bn in the most recent quarter.
Musk said a merger could align work on chips, AI and software. Recently, SpaceX acquired xAI and X before its market debut, and Tesla and SpaceX launched Terafab to manufacture chips. Ultimately, shareholders would decide, and at least 50% of Tesla's investors would need to approve a deal.
Comprehension
- What step have Tesla and SpaceX taken toward a possible merger?
- Who would make the final decision, and what approval threshold is named?
- What are the latest valuations of Tesla and SpaceX?
- How did SpaceX and Tesla shares move after Musk's comments?
- What recent moves show Musk bringing his companies closer together?
Grammar focus
Formal multiword connectors
Use fixed, formal connectors to link ideas: contrast, reason, condition, purpose, degree. Learn the forms: notwithstanding the fact that; in the event that; on the grounds that; by virtue of; with a view to; insofar as. (Examples constructed.)
- Shares rose, notwithstanding the fact that a merger isn’t guaranteed.
- Plans could align, insofar as both firms share goals.
Grammar exercise
Circle the correct option in each sentence.
- Firms invest (with a view of / with a view to) scaling AI.
- Talks may stop (on the grounds that / on grounds that) risk rose
- Shares climbed (by virtue that / by virtue of) Musk’s remarks.
- Plans change (in the event of / in the event that) a failure.
- Notes help, (insofar as / insofar that) they clarify terms.
Discussion
- Should two firms with different goals merge if synergies look strong? Why?
- How much influence should a founder have in deals that affect their wealth?
- Do the figures given make a merger look prudent or risky? Explain.
- What safeguards should protect customers and governments after such a merger?
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