Tesla (NASDAQ:TSLA) stock experienced a notable increase on January 30, 2024, following reports regarding a potential merger with SpaceX, the aerospace company also founded by Elon Musk. While the prospect of this merger is generating excitement among investors, it raises important considerations for Tesla shareholders.
Potential Benefits and Ownership Structure
A merger with SpaceX could offer significant advantages, particularly in terms of market valuation. Analysts suggest that if the merger proceeds, ownership could be divided based on the latest market values, potentially awarding Tesla shareholders around 63% of the combined entity. This arrangement appears beneficial, but it could have complex implications, especially concerning Musk’s recently approved compensation package.
In November 2025, Tesla shareholders voted to endorse a new compensation plan for Musk, linking much of his remuneration to the company’s market value. Should the merger occur, it would certainly elevate Tesla’s market capitalization by combining it with SpaceX, which is valued at approximately $800 billion.
However, the arrangement’s structure might not enhance Tesla’s stock value in the way shareholders might anticipate. Although the company would be larger, the increased number of shareholders could dilute individual stakes. As a result, while Musk could be closer to achieving milestones in his compensation package, this may not translate into direct financial benefits for Tesla shareholders.
Implications for Future Operations
The operational milestones tied to Musk’s compensation largely focus on Tesla’s core business areas, such as electric vehicles and autonomous technology, rather than SpaceX’s aerospace operations. Nonetheless, certain metrics, including earnings before interest, taxes, depreciation, and amortization (EBITDA) targets, could be positively influenced by the merger given SpaceX’s contributions.
Given the potential complexities, the formulation of a new compensation package for Musk may be necessary. However, modifying the existing plan so soon after its approval could be unconventional and raise further questions.
Despite the excitement surrounding the merger discussions, there is a possibility that the talks may lead nowhere, as similar speculations have arisen in the past without fruition. If the merger does proceed, it could offer SpaceX a less expensive route to market compared to a traditional initial public offering (IPO), making it a compelling prospect for SpaceX investors.
Tesla shareholders should remain vigilant as this situation unfolds, considering the potential implications for both their investments and the future trajectory of the company. The merger could ultimately position Musk as the primary beneficiary, further complicating the narrative for Tesla investors who expect direct advantages from the deal.
