This analysis was first published in SvD Näringsliv, in Swedish, on October 22nd, 2026. This piece was translated from Swedish by Claude. Some phrasing may differ from a human translation.
While the new Tesla car flew, the Ukrainian drones stayed on the ground. Elon Musk remains the main character of the world – and now the biggest sleight of hand of them all is being prepared.
In the world of magic it is called “misdirection.” You get the audience to look at one thing while the real trick happens somewhere else. In business, no one is better at this than Elon Musk.
This week, Elon Musk showed off the long-delayed Tesla Roadster in his own unique way. The car shot up a ramp, flipped in midair and landed back on the ground using rocket technology. The world gasped. But like any magician, he is carrying out the truly interesting maneuver somewhere else entirely.
Musk has had a busy few days. First came the flying car, then he offered a SpaceX share to every child in the US – and at the same time he set off a geopolitical row when Starlink’s satellite services slowed down, creating problems for Ukraine’s combat drones. On top of that, he holds a couple of day jobs as the CEO of listed companies, reporting quarterly results for both Tesla and SpaceX.
The space company started strong and beat analysts’ expectations by a wide margin. Tesla also edged past forecasts, even though revenue from car sales fell.
Quarterly numbers aside, it was the questions about the companies’ future that were most interesting. On Tuesday evening came word that Tesla and SpaceX are looking into a possible merger. If the world’s seventh- and eleventh-largest companies joined forces, they would move up to fifth place. Above all, though, it would consolidate Elon Musk’s power across several of the world’s most important markets – AI, space and robotics.
The idea of a new giant conglomerate under Musk has been around for a long time. I have written about the possibility myself in these pages, both in January and in June this year. Now each firm has appointed its own committee to look into the question. Musk himself has a conflict of interest and will not take part in the talks.
That is, at least, what they say publicly. In practice there is no doubt whatsoever about who is calling the shots in the proposed deal. Normal corporate governance is not something either Tesla or SpaceX has ever been known for. Tesla’s board, for instance, includes Elon Musk’s brother and his good friend James Murdoch. Musk himself has said it would be a “good idea.” That has traditionally been enough to win the backing of other shareholders.
The question, then, is why Musk wants this merger. The two are already tightly linked, with cross-ownership and customer relationships between them. Putting Tesla in the same corporate group would be logical.
We got a foretaste at Tesla’s previous quarterly report, where most of the carmaker’s profit came from the SpaceX shares it owned. When you see cars that fly, it is easy to picture a company at the absolute forefront. The numbers tell a different story, though.
Tesla’s operating margin came in at a meager 2.6 percent. That is mainly explained by how much goes into AI, leaving car sales struggling to cover the bill. The investments Tesla has to make going forward are also enormous. It has said itself that it wants to stop being seen as a car company and instead be regarded as an AI and robotics business. But so far there are a great many electric cars, and very few robots.
Here SpaceX can help. Large parts of its AI operation actually fit much better inside Tesla than among all those satellites in space. A merger would solve Tesla’s dilemma by shifting the focus to the new corporate group, easing the pressure on the car division’s own transition. It would also open the door to SpaceX’s cash pile of almost $90 billion.
Musk pulled a similar maneuver with the social network X when it was in trouble. It was sold into xAI, which in turn was sold into SpaceX. The problem – at least the part visible in the numbers – disappeared.
In that way, Elon Musk is a kind of Joe Labero (a famous Swedish magician) of the tech world. It is a show we are witnessing. He is extraordinarily unusual as a business leader, and it often feels as if he does the impossible. But is that really what is happening?
Because when Musk draws our attention in one direction, you are best off looking the other way. There lies a reality that is less glamorous, and where The New York Times reported this summer on hundreds of broken promises and exaggerations. Musk delivers a lot, but promises even more.
Or you can choose to do as his fans do: lean back and let yourself be entertained by the show. Sometimes what he accomplishes does feel like real magic. What other business leader can you say that about?
