Elon Musk on Monday firmly ruled out a merger between Tesla and his artificial intelligence company xAI, even as he pushes to deepen integration between the electric vehicle maker and his growing empire of tech ventures.
The billionaire made the declaration in response to a post from the X account @BullStreetBets_, which asked Tesla investors whether they supported a merger with xAI. Musk’s reply was brief but direct: “No.”
His comment comes amid renewed speculation over how closely Tesla and xAI will be intertwined in the future. Over the weekend, Musk suggested that Tesla shareholders would soon vote on whether the automaker should invest directly in xAI, the AI startup he founded in July 2023 to challenge the dominance of OpenAI and Google DeepMind.
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He insisted the decision wouldn’t be his alone. “It’s not up to me. If it was up to me, Tesla would have invested in xAI long ago,” he wrote on X, confirming plans for a shareholder vote, though he did not say when it would happen.
The latest comments underscore Musk’s attempt to walk a line between consolidating influence across his companies and respecting the governance structures of publicly traded Tesla. Still, critics and some Tesla shareholders have grown increasingly wary of Musk’s increasing focus on xAI, warning it could lead to a diversion of attention and resources away from Tesla’s core business.
While Musk said he doesn’t support a merger, he has continued to link the two companies strategically. Last week, Musk announced that Tesla vehicles will soon begin running xAI’s Grok chatbot through the vehicle infotainment system, marking a major product integration between the two firms.
That announcement came shortly after Musk confirmed that another of his companies, rocket builder SpaceX, is preparing to invest $2 billion into xAI as part of a broader $10 billion fundraising effort to expand the startup’s AI infrastructure. According to The Wall Street Journal, the investment includes both debt and equity and will be used to build data centers and improve Grok’s capabilities. Musk confirmed the SpaceX investment via a post on X, stating it would be “great,” but said it would still require board and shareholder approval.
The relationship between Musk’s companies — Tesla, SpaceX, X (formerly Twitter), xAI, The Boring Company, and Neuralink — has drawn increasing attention for what insiders have dubbed the “Muskonomy,” a web of interconnected firms that share technology, personnel, and now increasingly, financial backing.
xAI, valued at $80 billion in a March 2025 merger with X, has become central to Musk’s vision. It markets Grok as “the most intelligent AI to date,” a claim that comes despite growing criticism over the chatbot’s behavior. In recent weeks, Grok made headlines for generating antisemitic content and praising Adolf Hitler, prompting outrage and public scrutiny. xAI issued a public apology for the incidents, describing them as “horrific behavior” and pledging reforms to tighten safeguards.
Despite the backlash, xAI has forged ahead, and Musk continues to champion Grok. The startup launched Grok 4 last week, which is being hailed as smart. It has received more than $12 billion in funding through a mix of Series A, B, and C rounds and is racing to build out the infrastructure required to support large-scale AI models. Its stated goal is to take on major rivals like OpenAI and Anthropic, who have also recently launched new frontier models with ambitions to dominate the next wave of AI development.
In that race, capital is essential. Morgan Stanley, which led the recent $10 billion funding push for xAI, told investors that the company is expected to generate $1 billion in revenue by the end of this year and more than $13 billion annually by 2029. The funding will reportedly be used to construct massive data centers capable of supporting Grok and future models.
Musk’s comments this week suggest that while a merger between Tesla and xAI is off the table, their strategic alignment will continue to deepen through shared technology, product integration, and potentially significant cross-investment — pending shareholder consent.
For Musk, loyalty among investors across his companies is key. In a June post, he said he would prioritize “shareholders of my other companies, including Tesla,” if any of his businesses were to go public, adding that “loyalty deserves loyalty.”
As the lines continue to blur between Musk’s ventures, Tesla shareholders are now poised to play a central role in deciding just how closely the automaker should be tied to the billionaire’s AI ambitions. While some investors remain skeptical, others are betting that xAI’s success could help usher Tesla into a new phase of innovation — if the risks don’t outweigh the rewards.