Expert Dismisses Tesla SpaceX Merger Rumors as Risky Bet

Some Tesla investors are holding shares in hopes that SpaceX will acquire the electric vehicle maker at a premium. Investment manager Gary Black recently dismissed this idea as a case of the Greater Fool Theory. He explained that such a deal would cause massive dilution for SpaceX shareholders, making it an unlikely move for the company to make.

Black argues that the combined business would likely trade at Tesla's lower valuation multiple. This would cancel out the benefits of SpaceX's higher market standing. Instead of looking for a buyout, he suggests investors focus on Tesla's core business, such as the progress of its autonomous driving technology and overall earnings growth.

Both companies are facing tough market conditions throughout 2026. Tesla shares have dropped over 30 percent this year despite hitting record revenue. Meanwhile, SpaceX has seen its stock price fall significantly since its recent public debut. With both firms dealing with shrinking margins and high spending on new projects, experts suggest that fundamentals, rather than merger speculation, should drive investment decisions.