Tesla-SpaceX Merger Could Open Opportunities for Sphere... Set to Emerge as Key Player in 'Musk Empire' Supply Chain

Attention is focused on the possibility of a mega-company that could reshape the global technology industry, as Tesla and SpaceX, both led by Elon Musk, have officially begun exploring a merger. If Tesla, which has expanded its business around electric vehicles, autonomous driving and robotics, were to join forces with SpaceX, which has established a strong position in rocket launches, satellite communications and space transportation, the companies could build an integrated technology ecosystem spanning artificial intelligence (AI), semiconductors, robotics and the space industry.

The combination of the two companies is drawing attention because it could go beyond simply expanding their business scale and accelerate the technological convergence of AI, robotics and the space industry that Musk has pursued. In particular, if business links are strengthened across areas ranging from in-house semiconductor production and AI computing infrastructure to robotics and space data centers, changes are also expected in the supply chains and investment landscape of related industries.

On October 20 (local time), Musk said during SpaceX's third-quarter earnings conference call that the boards of both companies had formed special committees to review a potential merger.

Musk cited the development of superintelligent software, chip design, a terafab semiconductor factory, robotics, space transportation and connectivity through the Starlink satellite network as potential synergies from combining the companies. "I think there are a lot of advantages to merging the two companies," he said, expressing his view that their collaboration could bring substantial benefits.

The combined value of the two companies is approximately $3.5 trillion (about KRW 4,600 trillion to 4,800 trillion). However, several steps, including approval by Tesla shareholders, remain before a merger can be completed, so whether it will go ahead remains uncertain. Approval from holders of more than 50% of Tesla's outstanding shares is required.

The market is focused on the possibility that a merger could create a mega-technology company with vertically integrated operations spanning AI, robotics, space and semiconductors.

One of the central rationales for the merger is also the vertical integration of AI, robotics and space infrastructure. If SpaceX's orbital data centers, Starlink and Starship businesses are combined with Tesla's energy, robotics and autonomous driving technologies, the scale of business across the space industry could expand further.

SpaceX is also stepping up efforts to mass-produce Starship and increase its launch frequency. Next year, it aims to raise the launch frequency to once a week in the first half and at least twice a week in the second half. As the number of launches increases, demand for related materials and supply volumes could also grow.

If a merger with Tesla becomes reality, SpaceX could further accelerate the expansion of its production and launch capabilities, potentially leading to increased supply volumes or additional orders for existing suppliers of specialty alloys.

If a merger between Tesla and SpaceX becomes reality, Sphere Corporation (hereafter, Sphere), a South Korean listed company that has entered SpaceX's supply chain, is also being cited as a potential beneficiary. Sphere is a global supply chain management (SCM) company that supplies nickel superalloys and other specialty alloys for the aerospace industry. A key factor is that it has a long-term supply agreement with SpaceX.

After securing a Tier 1 vendor code from SpaceX in 2023, Sphere signed a long-term supply agreement in August 2025 to provide high-performance specialty alloys used in key components such as rocket engines and nozzles. The agreement runs for 10 years or more. Sphere has also strengthened the stability of its raw material supply by acquiring a 10% stake in an Indonesian nickel smelter.

Under Musk's leadership, the supply chain for key materials tends to favor reducing reliance on external sources and working with reliable, long-term partners. Analysts say that if the combination of Tesla and SpaceX expands in-house procurement, Sphere's position could be further strengthened as an already-vetted supplier.

Kyobo Securities has previously identified Sphere as a company to watch as the space industry enters a phase of "expanded mass production."

"Customer certification and quality verification for specialty alloys used in the aerospace industry take a long time, and changing materials also entails a significant revalidation burden, making early entry into the supply chain important," said Kwon Oh-hwi, a researcher at Kyobo Securities. He added, "As Starship production expands, supply growth, a broader range of products and increased market share for already-certified suppliers are more likely than the entry of new suppliers."

The expansion of related infrastructure, including Tesla's Optimus robots, Megapack energy storage systems (ESS) and terafab, is also seen as a medium- to long-term growth opportunity for Sphere. Researcher Kwon cited infrastructure expansion, including terafab, as a factor that could improve the company's earnings.

Analysts say that if demand for inventory accumulation from the launch of a safety stock program is added, material orders could exceed actual production volumes. As Starship production at SpaceX and Tesla's business expansion progress in tandem, market interest is expected to grow in the possibility that Sphere, which has entered the aerospace specialty alloy supply chain, could establish itself as a key materials partner of the "Musk empire."

This content was produced with the assistance of AI translation services.