Elon Musk: Tesla and Solar City won't merge with SpaceX

Tesla reported second-quarter earnings on Wednesday, and they were a lot worse than what analysts expected. But there were some bright spots, mainly involving a moderate increase in Tesla’s gross margins, implying that if they company weren’t pumping money into growth, it could conceivably be profitable.

After earnings were released, CEO Elon Musk and CFO Jason Wheeler held a conference call with analysts, and naturally the $2.6-billion Tesla Solar City merger, announced earlier this week, came up.

Morgan Stanley’s auto analyst asked if there might be some new synergies to be achieved with yet another of Musk’s companies, SpaceX. The question seemed to more about using Tesla’s low-orbit tech to assist in making Tesla vehicles increasingly autonomous, but Musk interpreted the query as being about a merger with Space X.

“There’s not a strong rationale to combine SpaceX and Tesla,” Musk said. He called the connection between Tesla and SpaceX “quite tenuous,” but he said that there was “some cooperation,” but nothing that would justify a tie-up.

So there you have it. Musk has no plans to put his entire empire under the Tesla roof.

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