--- title: "SpaceX issues another $20 billion in US debt: aiming to become the modern Union Pacific Railroad." type: "News" locale: "en" url: "https://longbridge.com/en/news/290263906.md" description: "SpaceX is preparing to issue at least $20 billion in investment-grade bonds to fund AI and orbital data center projects, marking a shift from equity to debt financing post-IPO. While analysts predict capital expenditures could exceed $1 trillion by 2031, bond market participants remain cautious due to SpaceX's lack of historical track record and the risk-return asymmetry of debt. Critics compare Musk's Union Pacific analogy to historical financial turmoil, warning of potential overexpansion." datetime: "2026-06-19T03:16:07.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/290263906.md) - [en](https://longbridge.com/en/news/290263906.md) - [zh-HK](https://longbridge.com/zh-HK/news/290263906.md) --- # SpaceX issues another $20 billion in US debt: aiming to become the modern Union Pacific Railroad. SpaceX's financing story is far from over with its IPO. According to Bloomberg, following its IPO, SpaceX is rapidly turning to the bond market to advance its artificial intelligence and orbital data center plans. The company has begun preparations for its first bond issuance, amounting to at least $20 billion; the three major rating agencies assigned it an investment-grade rating last Thursday, paving the way for the bond issuance. Analysts at Goldman Sachs and Evercore ISI predict that SpaceX's capital expenditures will exceed $1 trillion by 2031, with the majority going towards AI and space data center construction. Furthermore, estimates suggest that the company's net debt could exceed $400 billion by 2031, presenting the capital markets with an unprecedented financing stress test. This scale of financing has generated positive expectations in the market, but it is also accompanied by a noticeable sense of caution. Bond market participants are skeptical of SpaceX's massive borrowing while maintaining an investment-grade rating, with seasoned short sellers comparing it to the overexpansion of the 19th-century Union Pacific Railroad—which, under the guise of national development, fueled a capital frenzy but ultimately mired in financial and reputational turmoil. Musk, in his IPO roadshow, likened himself to Union Pacific, stating his goal was to "make Star Trek a reality," thus endorsing a multi-trillion-dollar valuation, but the historical echoes of this analogy have unsettled some observers. Equity financing concludes, debt financing takes over. According to reports citing sources familiar with the matter, SpaceX CFO Bret Johnsen and President Gwynne Shotwell made it clear in meetings with potential investors that this IPO will be the company's last sale of shares. To avoid diluting shareholder equity, including Musk himself, the company plans to primarily rely on debt market financing and will consistently emphasize its investment-grade rating throughout the IPO process. A research report dated June 18 by a team led by Oppenheimer & Co analyst Timothy Horan predicts that SpaceX's net debt will climb from its current level of approximately $13 billion to over $400 billion by 2031. This figure would exceed that of almost all publicly traded companies in the United States and would be more than three times the current debt level of Oracle. The team expects debt to be the primary source of financing for the company, supplemented by approximately $40 billion in additional equity financing. If realized, SpaceX's capital expenditures could exceed $700 billion annually in some scenarios by 2031. McKinsey's calculations show that the construction cost of ground-based data centers alone could reach $7 trillion by the end of this decade, and SpaceX's orbital data center plans will further push up this figure. ## Bond Market Remains Questionable, Investors Face Risk-Return Asymmetry Despite SpaceX's investment-grade rating, bond market participants remain cautious about its ability to raise large amounts of debt. "The vast majority of capital expenditures will have to be financed through equity, not the bond market," said Jim Fitzpatrick, head of U.S. investment-grade research at Allspring. "There is very limited room for large-scale debt issuance while maintaining an investment-grade rating, especially given the company's lack of a track record with rating agencies." Some investors directly point out the structural disadvantages of bond investment. Joe Hegener, chief investment officer at Asterozoa Capital, stated, "If you're going to buy into this frenzy, regardless of valuations, at least there's substantial upside potential in stocks. But in the bond market, your upside is capped by coupon payments, while the downside risk is your entire principal." Meanwhile, SpaceX's fundraising plans highly overlap with the IPO preparations of Anthropic and OpenAI, the latter two of which are expected to seek tens of billions of dollars in funding as early as this year. Tech giants like Alphabet are also continuously increasing their investment in AI infrastructure, creating significant supply pressure in the capital markets. Musk's self-comparison to the "Union Pacific" has been criticized by experts as "exploiting public ignorance." During the IPO roadshow, Musk compared SpaceX to the Union Pacific Corporation, which built the transcontinental railroad in the 19th century, saying, "People thought they were crazy." However, this analogy has backfired in the eyes of some historians and market participants. Stanford University Professor Emeritus of American History Richard White bluntly stated that Union Pacific was originally "a mess of self-dealing and corruption," and using it as a business model "is exploiting Americans' extreme ignorance of their own history and financial markets." Veteran short seller Jim Chanos pointed out that the collective expansion of SpaceX, along with other tech giants, Anthropic, and OpenAI, is a massive capital expenditure with little prospect of return within five to ten years—"huge expenditures are being poured in, and aside from selling shovels, there are almost no visible results." He also mentioned that the Credit Mobilier scandal in Union Pacific's history (insiders lining their own pockets through contracting companies) and Musk's active use of this analogy are "quite ironic." Despite ongoing skepticism, the financing boom continues, with AI infrastructure reshaping the capital market structure. Bloomberg data shows that US IPOs and stock sales have reached $163 billion this year, a 28% increase even excluding SpaceX's IPO. Data from JPMorgan strategists indicates that since November of last year, AI-related debt issuance has exceeded $300 billion across multiple credit markets, pushing total issuance this year close to historical peaks. "This is profoundly changing capital markets," said Lisa Clyde, co-head of global capital markets at Bank of America. "We're seeing increasingly blurred lines between products and between public and private markets, forcing companies to think more creatively about on- and off-balance sheet financing." Justin Reed, chief investment officer at Brown Brothers Harriman, characterized this wave of financing as a systemic shift: "We're building data centers, semiconductors, energy infrastructure, and satellite networks simultaneously. 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