Elon Musk’s business empire has been making waves in the market, with his companies Tesla and SpaceX being at the forefront. Recently, it has come to light that Tesla has sold approximately $890 million worth of vehicles and batteries to other companies within Musk’s orbit since 2023. This article delves into the details of these transactions and what they mean for the future of Musk’s empire.
Tesla’s Transactions with SpaceX
A recent filing has revealed that SpaceX has purchased around $131 million worth of Cybertrucks from Tesla in the last year, with the company paying full retail price for these vehicles. Additionally, Tesla has sold $506 million worth of Megapack batteries to xAI in 2025, and $191 million worth of batteries the previous year. These transactions have been cleared by Tesla’s audit committee as arm’s-length deals, indicating that they are legitimate business transactions rather than simply shuffling money between Musk’s companies.
SpaceX’s Plans for Artificial Intelligence
The batteries sold to SpaceX are not just for ground operations, but are also intended for use in the company’s plans to launch artificial intelligence into orbit. SpaceX’s S-1 filing outlines a plan to create a network of satellites that will act as data centers in space, and the costly buildout of this network is reflected in the company’s steep operating loss despite generating $18.7 billion in revenue. The fact that SpaceX is purchasing hardware from Tesla at full price suggests that these transactions are genuine spending rather than just paper shuffling between Musk’s businesses.
Tesla’s Demand Problem
The news of these transactions comes at a time when Tesla is facing a demand problem. The company delivered 358,023 vehicles in the first quarter, missing consensus and falling 14.4% from the previous quarter. Tesla also produced around 50,000 more cars than it sold, resulting in an inventory build that analysts have interpreted as a demand problem. Despite this, the company’s revenue and margins held up well, with automotive revenue increasing by 16% and gross margin expanding to 21.1%.
Speculation About a SpaceX/Tesla Merger
The close ties between Tesla and SpaceX have led to speculation about a potential merger between the two companies. SpaceX is adding longtime Tesla director Ira Ehrenpreis and SpaceX board observer Randy Glein to its board, deepening the connection between the two companies. Some analysts, including Chamath Palihapitiya and Dan Ives, have predicted that SpaceX will eventually merge with Tesla, allowing Musk to consolidate his two seminal assets onto one cap table. Kalshi’s “When will Tesla and SpaceX merge?” contract currently prices a deal before April 2027 at 40%, up five points.
Conclusion
The transactions between Tesla and SpaceX demonstrate the close ties between the two companies and the ways in which they are working together to achieve Musk’s vision for the future. While there is speculation about a potential merger between the two companies, for now, traders are betting that the empire will remain a federation rather than becoming a single entity. With Tesla trading at $422 and the company’s revenue and margins holding up well, it will be interesting to see how the relationship between Tesla and SpaceX continues to evolve in the future.