Morgan Stanley flags deepening Tesla-SpaceX ties amid physical AI push, hints at merger risk

Morgan Stanley analysts identified 71 references to Tesla in SpaceX's S-1 filing and documented escalating technology and infrastructure sharing between the two Elon Musk-led companies. The firms collaborate on Terafab, a Texas chip factory with Intel, and share compute resources for AI development. SpaceX spent over $506 million on Tesla Megapacks and Cybertrucks in 2025, while Tesla supplies robots, energy storage, and manufacturing expertise to SpaceX's compute operations set to reach 4.9 gigawatts by 2027. Morgan Stanley argues the companies are uniquely positioned to capitalize on physical AI opportunities separately or jointly, and analysts believe their growing interdependence could eventually lead to a merger.

1. Morgan Stanley analysts found 71 mentions of Tesla in SpaceX's S-1 filing, with 34% referencing direct collaboration and 41% tied to governance and related-party transactions
2. SpaceX purchased $506 million of Tesla Megapacks and $131 million of Cybertrucks in 2025
3. SpaceX Megapack purchases totaled $329 million in the first half of 2026
4. SpaceX supplies Tesla compute resources expected to reach 4.9 gigawatts by 2027
5. Musk has said people should imagine what action might follow from all the collaboration occurring across the firms on multiple levels