Tesla Inc. (NASDAQ:TSLA) and SpaceX (NASDAQ:SPCX) are two of Elon Musk's most closely watched ventures, and investors are increasingly pondering whether they might one day become one. Ross Gerber, President and CEO of Gerber Kawasaki, has a clear view: he sees stronger long-term potential in SpaceX than Tesla, and he believes the two companies will eventually merge, creating what he calls a "must-have" investment for global investors.
Tesla Plus SpaceX Could Become a ‘Must-Have’ Investment, Ross Gerber Says
MarketDash
Gerber Kawasaki's Ross Gerber puts 100% odds on a Tesla-SpaceX merger, calling the combined business a must-have global stock.
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Gerber Flags Tesla's Autonomy Challenge
Speaking to CNBC on Friday, Gerber said Tesla still faces the tough task of proving its autonomous driving technology can operate safely and profitably at scale. He pointed to the challenge of running potentially 100,000 autonomous vehicles while maintaining safety standards, and he gave credit to Waymo for its track record.
"We can't have people dying," Gerber said. "And I give Waymo a lot of credit. They have not had one fatality in a Waymo yet."
Gerber acknowledged that autonomous technology could ultimately reduce fatalities because humans are poor drivers. Despite his criticisms of Musk, he remains a Tesla investor and continues to support the company's electric-vehicle and autonomous-driving ambitions.
However, Gerber called Tesla's Robotaxi opportunity "unproven and difficult" and questioned whether it would become profitable. He said he would be more bullish on Tesla if the company focused more on selling electric vehicles rather than pursuing robots.
Gerber Prefers SpaceX Over Tesla
Gerber disclosed that he owns substantially more SpaceX than Tesla and said he has greater confidence in SpaceX's businesses and team. He highlighted SpaceX, Starlink, and xAI as major attractions, arguing that xAI is a critical piece of Tesla's future because Grok and Tesla's operating system depend on it.
"In essence, Tesla doesn't own its own operating system. It's owned by SpaceX," Gerber said, framing the relationship as a problem the companies eventually need to resolve.
When asked whether investors would be better off owning SpaceX than Tesla, Gerber said, "SpaceX is better to me."
Gerber Sees Tesla-SpaceX Merger As Inevitable
Gerber put the odds of a Tesla-SpaceX combination at 100%, although he acknowledged that valuation, shareholder interests, and legal complications could make a transaction difficult.
"I think it's 100%. I think it's just like the stars have to align," Gerber said.
He noted that changing valuations could complicate what represents a fair deal for shareholders of either company, while combining two public companies could create significant legal challenges. Still, Gerber said investors would welcome a single company bringing Tesla, SpaceX, and their related businesses together.
"I think investors would love one investment that's just all of this stuff in one pot, and it becomes a, a must-have in your portfolio as a global investor," Gerber said.
Gerber added that Tesla brings substantial cash and higher revenue, while he sees considerable future potential in SpaceX's businesses.
JPMorgan Sees Stronger Case For Tesla-SpaceX Merger
JPMorgan recently said SpaceX's public debut makes a potential combination with Tesla more financially practical by giving SpaceX highly valued stock it could use for an acquisition. The analysts said SpaceX's higher valuation makes a SpaceX-led, all-stock transaction more likely than a traditional merger of equals.
JPMorgan also called the combination "strategically coherent," pointing to shared engineering talent, AI infrastructure, the Terafab chip facility, and existing business ties across batteries, vehicles, and xAI. However, the bank said regulatory scrutiny and governance issues could complicate a deal, particularly because SpaceX has government and defense exposure while Tesla maintains a significant manufacturing presence in China.
JPMorgan said investors should watch regulatory approvals, shareholder support, and the eventual exchange ratio if the companies pursue a merger.
Price Action: Tesla shares were down 1.66% at $370.11 and SpaceX shares were up 0.89% at $151.07 during premarket trading on Friday, according to market data.
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