- Musk drew a parallel with his AI startup xAI, which he said is now being rebuilt “from the foundations up.”
- Tesla received U.S. government clearance to convert its investment in xAI into a small stake in SpaceX.
- Tesla’s $2 billion investment in xAI will give the EV maker a less than 1% stake.
Tesla CEO Elon Musk acknowledged that his EV firm “was not built right the first time,” drawing a parallel with xAI as the billionaire deepens financial ties between Tesla, SpaceX and the AI firm ahead of a potential SpaceX IPO.
TSLA stock declined more than 3% on Thursday, snapping a three-day winning streak and marking its worst session in over a month.
Musk Draws Parallel Between Tesla’s Early Struggles And xAI Rebuild
Musk said his AI startup xAI is being rebuilt “from the foundations up,” adding that the same thing happened during the early days of Tesla. “xAI was not built right first time around, so it is being rebuilt from the foundations up,” Musk said on X. “Same thing happened with Tesla.”
The comments come as Tesla’s financial ties with Musk’s other companies deepen, particularly after the EV maker received U.S. government clearance to convert its investment in xAI into a stake in SpaceX.
Tesla Converts xAI Investment Into SpaceX Stake
A new filing with the U.S. Federal Trade Commission shows that Tesla acquired a stake in SpaceX from Musk, who serves as CEO of both companies. The documents also show Musk selling holdings to investors, including Valor Equity Partners and DFJ Growth.
The regulatory filings were required since the deal exceeded $133.9 million in value, though details such as the size of the stakes were not disclosed.
Tesla’s previously announced $2 billion investment in xAI is reportedly being rolled over into SpaceX following the AI firm's merger with the rocket company last month. The investment would translate into a stake of less than 1% in SpaceX for Tesla.
Musk’s Empire Moves Closer Ahead Of SpaceX IPO
The deal underscores a broader reshaping of Elon Musk’s business empire as SpaceX prepares for a potential IPO that could become one of the largest in history.
Musk’s companies, spanning electric vehicles, rockets, artificial intelligence and social media, are increasingly interconnected through investments and shared technology strategies. Last month, SpaceX confirmed it would acquire xAI in a deal valuing the AI startup at about $125 billion and SpaceX at roughly $1 trillion, with Musk calling the combination an “innovation engine” that brings together AI, space infrastructure, and satellite internet.
Tesla had previously announced a $2 billion investment in xAI, positioning the AI company as part of its future robotics and automation plans. Musk has also discussed potential links between his companies’ technologies, including using Tesla energy systems to power space-based data centers and Starship rockets to transport Tesla’s Optimus robots.
In January, SpaceX reportedly explored potential mergers with Tesla or xAI as part of discussions to consolidate Musk’s companies ahead of a listing. Tesla remains the only publicly traded firm among Musk’s major ventures.
How Did Stocktwits Users React?
On Stocktwits, retail sentiment for TSLA was ‘bullish’ amid ‘high’ message volume.
One user noted, “$2 billion investment divided by 3 billion shares outstanding = 65 cent investment per share of Tesler. Meanwhile, you lost $12/ share today.”
Another user expects TSLA stock to fall below the $380 level on Friday.
TSLA stock has declined 12% year-to-date.
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