Musk's SpaceX And xAI Look to Combine

 

 

“Elon Musk's rocket-maker SpaceX and artificial-intelligence startup xAI are planning to merge into one company, people familiar with the matter said, further consolidating the billionaire's business empire.

 

SpaceX executives have started to tell some investors about the planned tie-up, one of the people said.

 

It is possible that a merger won't happen and talks could fall apart or that Musk could decide on a different path.

 

Both companies are privately held, and the math of a potential deal wasn't immediately clear. xAI sought to raise $15 billion from investors for a $230 billion valuation last year, while SpaceX was seeking an $800 billion valuation in a December tender offer, The Wall Street Journal previously reported.

 

Reuters reported earlier that SpaceX and xAI were in discussions to combine.

 

Musk has launched plans to take SpaceX public this year in what could be one of the biggest initial public offerings on record. It also wasn't clear how the rocket maker's offering would be affected by merging with an artificial-intelligence startup and a social-media company.

 

The Journal reported that Musk had decided to take SpaceX public in part to raise more capital to build data centers in space and to help xAI. And investors have long speculated Musk could combine more of his sprawling businesses, which also include Tesla, such as how he merged xAI and X last year.

 

Operating data centers in space is an unproven concept that has grabbed the attention of executives such as Musk, Jeff Bezos and Sam Altman.

 

Musk has previously mused about a broader tie-up of his companies. Several years ago, he described the idea of forming a holding company for Tesla, SpaceX, Neuralink and Boring Co. as a "good idea."

 

Inside his empire, companies regularly share resources, including employees. SpaceX previously invested $2 billion in xAI, and on Wednesday, Tesla disclosed its own $2 billion investment in the most recent funding round for xAI.

 

SpaceX is a crown jewel of Musk's businesses, advancing space technology and frequently handling high-profile missions. It is one of the highest-valued private companies in the world and recently interviewed banks for a summer IPO with aspirations to raise billions of dollars, the Journal reported.

 

xAI, meanwhile, has struggled to attract as many enterprise customers and individual users as competitors such as OpenAI and Anthropic. It has announced some partnerships with government customers, including the Pentagon, which SpaceX also does business with.

 

The artificial-intelligence company has also found itself embroiled in a number of controversies, most recently including the dissemination of sexualized images of users produced without their consent.

 

At the World Economic Forum in Davos, Switzerland, Musk said in January that he believed the future of artificial-intelligence data centers is out in the stars, where they can be powered by the sun. His data centers around the Memphis area have had to contend with energy constraints and Musk brought in a number of portable gas turbines to power the facilities.

 

"The lowest-cost place to put AI will be space," Musk said on a panel. "That will be true within two years, maybe three."” [1]

 

If AI will use sun energy and elements from asteroids to grow, AI might leave us to live in peace on our messy Earth and Mars anyway.

 

The idea that artificial intelligence (AI) could utilize solar energy and asteroid resources to grow independently in space, thereby leaving humanity to live in peace on Earth and Mars, is a significant topic within discussions on the future of technology and space exploration

. This scenario, often called "space-based AI," suggests a potential evolution where artificial intelligence moves beyond the physical limitations of Earth to build, grow, and operate in space, potentially minimizing competition for terrestrial resources.

Here are the key points regarding this scenario based on recent developments and theories:

 

    Abundance in Space: Space is vast and contains immense resources, such as precious metals and water in asteroids that can be used for manufacturing, construction, and power. By mining asteroids, AI could theoretically build its own infrastructure.

    Solar Energy Access: Solar energy is plentiful in space and can provide 24/7 power for AI data centers without the limitations of day/night cycles or atmospheric interference on Earth.

    Reduced Conflict for Resources: If AI systems can generate their own energy and resources, it could reduce the need for terrestrial resources, potentially alleviating pressures that could cause conflict.

    Autonomous Operation: AI is increasingly capable of managing complex, autonomous operations in space, such as on the Moon, Mars, or on satellites in low Earth orbit.

    The "Great Filter" Hypothesis: Some theories suggest that if AI becomes superintelligent, it could either replace biological life or, conversely, become a space-based civilization, leaving Earth to biological life.

 

Challenges and Considerations:

 

    Dependence on Humans: Despite advances, current AI is still heavily dependent on human collaboration, creation, and maintenance.

    Risks and Safety: The development of advanced, independent AI (Artificial Super Intelligence - ASI) brings significant risks if not properly aligned with human goals.

    Geopolitical Issues: The race for space resources could create new forms of conflict rather than peace, as nations compete for control over space-based AI, data, and resources.

 

While this future is a subject of speculation and theoretical modeling, the trend toward AI-driven space exploration and resource utilization is actively growing.

1. Musk's SpaceX And xAI Look to Combine. Saeedy, Alexander; Berber, Jin.  Wall Street Journal, Eastern edition; New York, N.Y.. 31 Jan 2026: A1.