Musk Says A Tesla-SpaceX Merger Is “A Good Idea,” But Admits It Would Require 1.98 Billion “Yes” Votes. He Calls It “Quite A High Hurdle”
Elon Musk called a Tesla and SpaceX merger a good idea, then immediately explained why pulling it off could be nearly impossible. The math behind the shareholder vote reveals just how steep the climb really is.
Elon Musk says combining SpaceX (NASDAQ:SPCX | SPCX Price Prediction) and Tesla (NASDAQ:TSLA) would be a good idea. He also says Tesla’s side of the shareholder vote would be hard to win.
On SpaceX’s third-quarter earnings call on October 20, 2026, Deutsche Bank’s Edison Yu asked about a combination. Musk replied: “This is definitely the kind of question where I feel like I’m tap dancing through a minefield.” Then: “Do I think it would be a good idea? Yes.”
However, he said said that merger would face a “high threshold” due to the vote requirement. Elon Musk said Tesla would need a 50% vote: “Particularly on the Tesla side, we will need a 50% vote of all shares, not just those who vote, but of all shareholders. And that’s quite a high hurdle to try to achieve.”
How the 1.98 Billion Yes-Vote Figure Is Calculated
Tesla’s 10-Q cover page lists 3,952,757,946 shares outstanding as of Oct. 15, 2026. Based on that 10-Q count, a majority of all shares is at least 1,976,378,974, or about 1.98 billion. That figure is our own calculation. Musk did not cite it. Because the threshold is measured against all shares, any share that goes unvoted works against a deal.
According to TIKR, turnout at Tesla’s 2025 annual meeting was about 74%. If a merger vote saw the same turnout, a deal would need 67.6% of the votes cast. Treat that as an illustration of the math, since turnout for a merger vote could be different. Tesla is a Texas corporation, according to its SEC filing. Musk’s description is the only public account of the threshold.
Why Low Retail Turnout Makes the Vote Harder
Tesla’s Sept. 29, 2026 letter to the SEC cited Broadridge Financial Solutions data showing that retail investors voted only 28% of their shares in the 2025 proxy season, while institutions voted 76.6% of theirs. In the same letter, Tesla said it spent over $2 million on proxy solicitors alone to get retail holders to vote at its two most recent annual meetings. According to TIKR, a 2025 Tesla supermajority proposal drew about 54% of votes cast but only about 39.4% of all shares. Barclays puts broker non-votes at about 11% of outstanding votes, per TIKR.
The letter also describes a retail auto-vote program. Enrolled holders’ votes automatically follow the board’s recommendation. Each holder picks one of two options: all matters, or all matters except contested director elections and any acquisition, merger or sale that needs shareholder approval. Holders who choose the second option would get a reminder before a merger meeting. According to Tesla North, the SEC cleared the program on Sept. 29. No enrollment figures are public.
Where Merger Talks Stand Now
Both companies have formed special committees of independent directors. Musk said “because I’m a conflicted party, I can’t actually be in the discussions of the special committees.” He added that “the special committees have not reached agreement on the terms of any transaction. And obviously there’s no guarantee that they will.” No terms or premium have been offered. According to the Khaleej Times, Musk holds about 20% of Tesla and more than 80% of SpaceX’s voting power.
The two companies’ latest results differ sharply. In Tesla’s third-quarter filing, operating income fell to $718M from $1.62B, while R&D spending rose to $2.76B. SpaceX reported revenue of $14.60B and net income of $4.40B.
What Tesla Shareholders Are Watching Before Any Vote
According to investingLive, J.P. Morgan expects any deal to be SpaceX-led and all-stock, at a 30% to 35% premium. Using that range to a $373.71 close, TIKR calculated about $486 to $505 a share. Those numbers are TIKR’s own arithmetic.
J.P. Morgan has not set that as a target, and no offer exists. Barclays upgraded Tesla to Overweight and raised its price target to $450 from $370, per TIKR.
Tesla closed at $391.62 on Oct. 26, a gain of 5.21% per HeyGoTrade. It then closed at $407.46, up 4.04%. At 9:49 AM ET today, shares traded at $402.60, down 10.48% for the year. On Polymarket, traders price separate contracts for an official merger announcement at 19% by Dec. 31, 2026, 59% by June 30, 2027 and 70% by Dec. 31, 2027. Those are prediction-market prices and should not be read as a forecast.
The biggest open question is what the special committees decide. If they agree on terms, every Tesla share will count. Shares that are never voted will count the same as a no.
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AJ spent 10 years writing about financial markets at The Motley Fool. His coverage centers on technology stocks and the broader macroeconomic trends, from interest rates to geopolitics, that shape where markets are headed next. AJ is drawn to the stories where big-picture economics and individual companies collide.
