Musk Proposes Tesla-SpaceX Merger; Tesla Posts 42.7% Profit Decline

The proposed merger would create a combined entity exceeding $3.5 trillion in valuation, spanning automotive, energy, satellite communications, and aerospace sectors. Tesla's approval requires 50% of all shareholders to vote in favor—a higher threshold than SpaceX's, given Musk's majority voting control of SpaceX post-2026 IPO. Tesla's 42.7% profit decline signals near-term operational pressure; the merger proposal and rising capex on AI/robotics suggest a strategic pivot. Market reactions (SpaceX +6.6–8%, Tesla +1.6–3.41%) and shareholder vote requirements will determine if the deal proceeds and how business integration unfolds across supply chains, manufacturing (Terafab chip fab targeting 2028), and orbital infrastructure (Starmind data centers).