--- title: "Is Tesla divesting its Chinese operations to merge with SpaceX? Musk refutes: Never discussed, purely \"absurd fake news\"" type: "News" locale: "en" url: "https://longbridge.com/en/news/294657675.md" description: "In response to rumors that Tesla plans to sell its Chinese business to merge with SpaceX, Musk firmly denied the claims, calling the report \"absurd fake news\" and stating that he has never discussed such a matter. Previously, the market speculated about a merger due to the overlap in the AI strategies of the two companies, but Musk emphasized that a merger is not a topic for performance meetings" datetime: "2026-08-03T07:49:05.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/294657675.md) - [en](https://longbridge.com/en/news/294657675.md) - [zh-HK](https://longbridge.com/zh-HK/news/294657675.md) --- # Is Tesla divesting its Chinese operations to merge with SpaceX? Musk refutes: Never discussed, purely "absurd fake news" According to the Zhitong Finance APP, **Tesla (TSLA.US) CEO Elon Musk has denied reports that the electric vehicle giant is considering selling its China business.** Previously, there were reports that selling the China business could pave the way for a potential merger between Tesla and SpaceX (SPCX.US). It was reported that Tesla executives had been asked to prepare for a separation from the China business, with possible options including spinning off the China business for public listing or shutting it down. In response to the related reports, Musk denied them. He stated, "This has never come up in any discussions." He later called the report "absurd fake news" and urged people to "assume news is false until proven true." Since SpaceX went public, speculation has intensified that Musk will push for a merger between SpaceX and Tesla, as the strategic layouts of the two companies in the field of artificial intelligence (AI) are highly overlapping. Musk has frequently mentioned the trend of "integration" among his companies. In a previous earnings call, he acknowledged that the business overlap between Tesla and SpaceX is increasing, but stated that merger discussions are not a topic that can be addressed in Tesla's performance meetings. In February of this year, SpaceX acquired the AI company xAI, founded by Musk, which has since been renamed SpaceXAI. SpaceX and Tesla have multiple business interactions: Tesla supplies Megapack energy storage batteries and Cybertruck electric pickups to SpaceX, while SpaceXAI's AI chatbot Grok has also been integrated into some Tesla models. Reports indicate that spinning off Tesla's China business (including the Shanghai Gigafactory) would help avoid potential conflicts of interest arising from SpaceX's role as a major U.S. defense contractor. Such a transaction aims to establish a "firewall" between Tesla's China subsidiary and its U.S. operations. China is a crucial component of Tesla's business. Tesla's Shanghai Gigafactory not only serves the Chinese market but also supplies vehicles to other countries through exports. Centered around the Shanghai Gigafactory, Tesla accounts for more than half of global order deliveries. In the first half of 2026, the Shanghai factory delivered 468,000 vehicles, a year-on-year increase of 28.4%, achieving the highest production level for the same period in nearly three years. Since its production began six and a half years ago, the factory has produced over 4.5 million vehicles, accounting for more than 45% of Tesla's total global output. The Tesla Model Y remains highly popular in China, consistently ranking among the top in sales charts in the Chinese market. Recently, Tesla launched the Model Y L in the U.S. market, which is a six-seat version of the Model Y SUV series. This model first debuted in the Chinese market last year and was specifically designed for that market. 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