“SpaceX said it secured the right to buy artificial-intelligence coding startup Cursor for $60 billion.
In a post on X Tuesday, SpaceX, formally named Space Exploration Technologies, announced that the companies were working closely together on coding and AI and that it had an option to purchase Cursor later this year. If there isn't a purchase, SpaceX could pay $10 billion for work in the partnership.
"The combination of Cursor's leading product and distribution to expert software engineers with SpaceX's million H100 equivalent Colossus training supercomputer will allow us to build the world's most useful models," SpaceX said.
Colossus is an AI computing complex that Elon Musk's xAI developed in Memphis, Tenn.
The agreement comes as SpaceX prepares for a massive public offering that is expected to fill the company's coffers with billions of dollars in new capital that it would use to develop AI models to compete with industry heavyweights like OpenAI and Anthropic.
Texas-based SpaceX continues to reinvent itself ahead of the planned offering. The company, long focused on launching rockets and deploying satellites, acquired xAI earlier this year, folding Musk's nascent AI company into its sprawling aerospace operation.
Silicon Valley's buzziest startups and large technology companies are battling for business customers eager to use coding and other AI-powered tools to boost productivity. Cursor competes with the likes of Anthropic's Claude Code and OpenAI's Codex, which can write code, debug software and automate other mundane coding tasks.
The increasing sophistication of these tools has triggered a massive selloff in shares of software, legal, finance and healthcare companies.
Some companies have attributed reductions of tens of thousands of jobs to AI and the ways it may reshape how work is done.
Cursor was started by four MIT graduates out of a living room in 2023 as an encrypted messaging startup but has since grown into a leader in AI coding tools. The company last closed a round of financing in November that valued it at $29.3 billion.
Cursor makes an AI coding tool that allows developers to toggle between different AI models, from OpenAI and Anthropic to xAI and Google and more. But the startup has faced increasing competition in the last year as those same AI labs launch their own coding tools.
Due to the startup's reliance on third-party models, it pays substantial fees to the biggest AI labs. Last fall, the startup launched its own AI model, called Composer, to reduce that dependency.
Developers say Cursor's homegrown model is sufficient, but some still prefer tapping other models more.
"Excited to partner with the SpaceX team to scale up Composer," said Michael Truell, co-founder and chief executive of Cursor, in a message on X on Tuesday. "A meaningful step on our path to build the best place to code with AI."
The company rebuffed acquisition interest from a number of major AI companies last year, The Wall Street Journal previously reported.
Based in the North Beach neighborhood of San Francisco, the startup has a no-shoes policy in the office, where the floor is lined with ornate rugs for workers' socked feet. A chef named Fausto serves lunch six days a week.
SpaceX's growing AI ambitions depend on the on-the-ground computing infrastructure that its xAI business has developed. But SpaceX is also planning to use its powerful space assets, including rockets and satellite-manufacturing capacity, to compete with AI heavyweights.
The company has asked regulators to deploy up to one million AI satellites, saying that solar-powered orbital datacenters could take on computing tasks that are currently being handled on the ground.
Deploying orbital datacenters at a mass scale and in a cost-competitive manner will be a difficult task, many space and satellite engineers have said.”
What is the strongest Cursor competitor in China? Let us compare the prices of these two.
As of early 2026, the strongest direct Cursor competitor in China is Trae, a free AI-native Integrated Development Environment (IDE) backed by ByteDance. While other Chinese models exist, Trae specifically mirrors Cursor’s UX while offering a free-to-use, "loss-leading" model designed to capture the market.
Top Cursor Competitor in China: Trae
Trae is an AI-powered IDE that offers both a local client and a browser-based Cloud IDE, making it a direct competitor to Cursor's "agentic IDE" approach.
Key Advantage: It is currently available for free to Chinese users, which allows it to offer a similar experience to Cursor's paid subscription without the upfront cost.
Features: It supports AI-powered code completion, chat, and multi-file editing.
Best for: Budget-conscious developers and Chinese developers seeking a free, high-performance Cursor alternative.
Price Comparison: Trae vs. Cursor
Trae AI (China Edition): Completely free.
Cursor (Pro Plan): Starts at $20/month for individual developers.
Feature Cursor Trae AI (China)
Model Multi-model (OpenAI, Claude, etc.) Optimized for Local Chinese Models
Price ~$20/month Free
Type VS Code Fork VS Code Fork
Context 500 Fast Requests/mo Free/Unlimited (currently)
Other Notable Chinese AI Coding Tools
While Trae is the closest "IDE" competitor, other powerful, specialized AI coding tools in China include:
Tongyi Lingma (Alibaba): A popular VS Code extension (12.9% market share in China) that acts as an "AI Employee," often free for individuals, with enterprise plans.
DeepSeek-Coder-V2: A top-tier open-source coding model that rivals GPT-4, commonly used via extensions like Continue.
Baidu Comate: An AI-powered IDE with strong multimodal capabilities (design-to-code).
Note: The AI coding tool landscape in 2026 is rapidly evolving, with local Chinese models frequently offering lower-cost APIs (starting as low as $0.028 per 1M tokens).
1. SpaceX Obtains $60 Billion Option on AI Firm. Maidenberg, Micah. Wall Street Journal, Eastern edition; New York, N.Y.. 22 Apr 2026: B1.
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