A Wall Street Journal report has ignited a fresh round of speculation around Elon Musk's business empire: the paper said Tesla is weighing the sale or separation of its China business to smooth the path toward a potential merger with SpaceX, Musk's rocket company.
Citing people familiar with the matter, the WSJ reported that some Tesla executives have been told to prepare for a separation of the company's China operations. The consideration comes as rising geopolitical tensions between Washington and Beijing complicate the position of a U.S. automaker running a major manufacturing hub — including the Shanghai Gigafactory — inside China.
Musk responded swiftly and bluntly. 'Absurdly fake news,' he wrote, according to Reuters, pushing back on the report. Yet even as he dismissed it, the Reuters story noted that a merger between Tesla and SpaceX would raise significant regulatory and geopolitical hurdles, particularly in China, where authorities have scrutinized foreign technology companies closely.
The report has nonetheless fed weeks of speculation about Musk's next moves after he signaled plans to combine Tesla and SpaceX. Analysts and media across the spectrum — from Electrek to Investor's Business Daily — have been parsing what a tie-up between the electric-vehicle maker and the space company would mean for both businesses. Tesla did not respond to requests for comment, and SpaceX has not commented publicly.
