Something big is building inside Elon Musk’s empire right now, and depending on which corner you’re watching, the story looks completely different. On one side, there’s a growing wave of backlash from Tesla shareholders and Wall Street analysts who are increasingly alarmed about SpaceX merger talks that could fundamentally change what it means to own a piece of Tesla.

On the other hand, a new academic study just dropped a finding that most mainstream media haven’t touched: most large utility-scale solar projects in the United States face far less public opposition than the headlines suggest. Both stories are about the gap between perception and reality, and both have enormous consequences for where Musk’s empire is actually headed.

The SpaceX Merger Backlash Is Real and Getting Louder

If you’ve been following the news this year, you know SpaceX is barreling toward a historic IPO. The company filed its S-1 with the SEC on May 20, 2026, and is targeting a Nasdaq debut around June 12 under the ticker SPCX, chasing a valuation of up to $1.75 trillion. That would make it the largest public offering in history, surpassing Saudi Aramco’s 2019 listing.

Alongside that IPO push, CNBC reported that Musk has recently held in-depth discussions with close associates about integrating SpaceX and Tesla into a single company. Early SpaceX investor Peter Diamandis called a Tesla tie-up “not a matter of if, but only a matter of when.” Chamath Palihapitiya wrote on X that the combination would “instantly create the Berkshire Hathaway of the modern century.”

But not everyone’s cheering, and the pushback is coming from people who know what they’re talking about. Investor Gary Black of The Future Fund said a SpaceX merger “makes no sense mathematically for Tesla shareholders” without enormous synergies, pointing to a 35% dilution risk for existing holders. Ross Gerber, CEO of Gerber Kawasaki Wealth Management, went further, arguing this deal would function “less like a merger of equals and more like an acquisition of Tesla by SpaceX,” while flagging serious conflict-of-interest concerns.

The root of that concern is hard to ignore: Musk holds over 85% voting power in SpaceX while simultaneously running Tesla. Any SpaceX merger structured as a stock swap puts Tesla shareholders in the position of merging their $1.6 trillion company into an entity one person controls almost completely.

I’ve been following this story closely since the Bloomberg and Reuters reports first broke in January 2026, and honestly, the governance angle is the piece that doesn’t get enough attention. It’s easy to get distracted by the trillion-dollar valuations and the vision of a single orbital AI company. What’s harder to think about, but more important, is what Tesla’s minority shareholders would actually be agreeing to.

Musk’s Self-Dealing Pattern Makes the SpaceX Merger Harder to Trust

The resistance to the current SpaceX merger talk isn’t happening in a vacuum. Critics are framing this as Musk’s fourth major self-dealing move in roughly a decade. In 2016, Tesla acquired SolarCity, a money-losing solar installer where Musk was chairman and the largest shareholder, for $2.6 billion in stock. Shareholders sued, alleging it was a bailout. A Delaware court ruled the deal was fair, but other Tesla directors settled for $60 million without admitting fault.

Then came the $44 billion Twitter acquisition in 2022. Then, Tesla’s $2 billion investment in xAI in January 2026, despite shareholders having previously rejected a similar proposal. Within weeks of that investment, SpaceX absorbed xAI in a deal worth roughly $250 billion. According to SpaceX’s own IPO filing reported by TechCrunch, xAI lost $6.4 billion from operations on just $3.2 billion in revenue in 2024, with losses expected to grow as the company scales up its Grok model. Tesla shareholders’ money went in before that financial picture became fully public.

After looking at this pattern more closely, the concern becomes clear: each deal has left Tesla’s minority shareholders absorbing risk while Musk consolidated control. Sources familiar with the situation suggest institutional investor pushback on any formal SpaceX merger proposal could be far more intense than anything Musk has faced before, particularly given the governance terms and the scale of SpaceX’s capital requirements heading into 2026 and 2027.

The Solar Story Nobody Is Covering Properly

Here’s the part of this whole situation that genuinely surprised me when I started digging in. While everyone debates the SpaceX merger and its risks for Tesla, the energy and solar side of Tesla’s business is quietly outperforming, and a brand new study just demolished one of the most persistent myths in energy journalism.

Researchers at the University of Massachusetts Amherst analyzed 686 utility-scale solar projects that came online between January 2022 and November 2023. What they found should change how you think about solar energy in America: 56% of those projects fell into “no” or “low” conflict categories. Only 19% experienced high levels of opposition. The findings, published in the journal Energy Research & Social Science, directly challenge the narrative that large solar farms constantly spark local fights.

Lead author Juniper Katz, an assistant professor of public policy at UMass Amherst, said she was surprised herself: “All I saw in the news was conflict, conflict, conflict over solar, but there was really very little research that looked at it from a national scale.” The study also found no statistically significant connection between the political makeup of communities near solar projects and the level of opposition, which differs from earlier research on wind energy.

What most articles missed is that this finding is especially significant right now. Electricity demand across the US is climbing fast, driven largely by the expansion of AI data centers. Utilities are racing to add new power generation, and the assumption that solar projects will face relentless local pushback has been quietly shaping policy and investment decisions. The UMass data suggests that the assumption is built on noise, not signal.

Tesla Energy Is Already Thriving Without the SpaceX Merger

This solar story matters directly for Tesla because the energy segment is one of the strongest businesses Musk is running, and it keeps getting buried under every EV headline. In 2025, Tesla’s energy generation and storage revenue climbed to $12.7 billion, up 27% year over year. That segment now accounts for 13% of total Tesla revenue, compared to just 10% in 2024. Full-year energy storage deployments hit 46.7 GWh, a 49% increase, and gross margins for the energy segment reached a record 39.5% in Q1 2026.

SpaceX’s own IPO filing made the interdependence concrete: the company purchased $697 million worth of Tesla Megapacks in 2024 and 2025 to power xAI’s data centers near Memphis, Tennessee. These two companies are already operating as a closely linked supply chain, regardless of whether a formal SpaceX merger ever gets announced. Tesla is also building a new Megafactory outside Houston, launching Megapack 3, and its Powerwall network supported over 89,000 virtual power plant events across more than one million installed units in 2025, helping homeowners collectively save over $1 billion on electricity bills.

Many believe that once Wall Street fully prices in the energy segment’s margins and growth trajectory, Tesla’s valuation story will shift dramatically away from its troubled EV narrative. Industry analysts hint that the energy business could rival or even exceed Tesla’s automotive revenue within five years if current deployment rates hold. It is rumored that Tesla’s planned $2.9 billion solar equipment purchase signals the company is moving toward utility-scale solar manufacturing at a speed that few analysts have factored into their models.

The Real Risk Is the Distraction, Not the Dream

Personally, I don’t think the SpaceX merger idea is impossible to justify. The potential synergies are real: Megapacks powering orbital data centers, Tesla AI hardware feeding Starlink infrastructure, and Optimus robots assembling Starships. Ars Technica’s senior space editor Eric Berger described a combined SpaceX-AI entity as “a vertically integrated AI colossus,” and the logic holds at the highest level of abstraction. Gene Munster of Deepwater Asset Management puts the probability of a Tesla-SpaceX combination above 50% within five years.

But the execution risk here is enormous. SpaceX is planning over $25 billion in spending in 2026. Tesla is navigating a difficult EV market, declining automotive revenue, and serious credibility questions around its FSD program. Merging these two companies right now, under a governance structure where one person holds overwhelming voting power in one of them, is the kind of distraction that has cost Tesla shareholders before. Sources suggest pressure for a formal merger announcement could intensify sharply in the second half of 2026, particularly if the SpaceX IPO exceeds its valuation targets in June.

The solar and energy side of Tesla’s business, meanwhile, needs no rescue and no merger to justify its growth. It’s building quietly, profitably, and right now without the noise.