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Elon Musk denies Tesla's potential China business sale ahead of SpaceX merger, citing "fake news" with significant regulatory hurdles and geopolitical
Elon Musk has denied a report that Tesla is considering a sale of its China business ahead of a potential merger with SpaceX, calling it "fake news" [1]. The report had suggested that some Tesla executives had been told to prepare for a separation of the China business, with options including a spinoff, sale, or closure [2]. The denial comes as speculation mounts about a potential merger between Tesla and SpaceX, with Musk having previously acknowledged the growing overlap between the two companies [3].
| At a glance | |
|---|---|
| Company | Tesla |
| China Business | $10 billion+ in annual revenue [2] |
| SpaceX | Major US defence contractor |
| Merger Speculation | Growing overlap between Tesla and SpaceX [3] |
The potential merger between Tesla and SpaceX would raise significant regulatory hurdles, particularly in China, where Tesla operates wholly owned manufacturing facilities [2]. SpaceX, as a major US defence contractor, is involved in national security and satellite programs, which could create geopolitical tensions with China [2]. Musk's denial of the report suggests that Tesla is not currently considering a sale of its China business, but the company's future plans remain unclear [1].
Tesla's China business is a significant contributor to the company's global revenue, with over $10 billion in annual revenue [2]. The company's Shanghai factory is one of its most important manufacturing facilities, producing over half of Tesla's global output [2]. A potential merger with SpaceX could create new opportunities for Tesla, but it would also require careful navigation of regulatory and geopolitical complexities [3].
The denial of the report by Musk has significant implications for Tesla's future plans and strategy, particularly with regards to its China business. As the company continues to navigate the complexities of its relationship with SpaceX, it remains to be seen how the situation will unfold and what the ultimate outcome will be for Tesla's China operations.
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AI-assisted synthesis by the TrendWatcher Editorial Desk · sourced from 3 outlets · Jul 31, 2026 · How we report
No. Elon Musk has denied such reports, calling them "fake news," and said no discussions have taken place.
The Shanghai Gigafactory historically accounts for more than half of Tesla's global deliveries.
More than half of the roughly 463,000 EVs sold in the U.S. in the first six months of 2026 were Teslas, with the Model Y alone representing over a third of those sales.
Regulatory approvals and national‑security concerns, particularly in China where SpaceX has U.S. defense ties, could pose significant hurdles.
Tesla operates about half of all fast‑charging plugs in the United States and has opened many of its Supercharger stations to other EV brands.