Tesla May Merge With SpaceX: Report

Happy Friday! It’s January 30, 2026, and this is The Morning Shift — your daily roundup of the top automotive headlines from around the world, in one place. This is where you’ll find the most important stories that are shaping the way Americans drive and get around.

In this morning’s edition, we’re looking at Elon Musk’s corporate consolidation, as well as China’s ever-increasing sales in Europe. We’ll also look at California’s work on emissions regulations, and the return of the minivan. 

Tesla is in a bit of a weird spot right now, as its car sales plummet and its CEO insists that it’s a robotics and AI company now. This is, of course, somewhat redundant — Musk already has an AI company, in the form of xAI and its on-demand CSAM provider Grok. So, now, it seems Musk is looking to consolidate his empire. He’s now looking to merge Tesla with… SpaceX. Or maybe SpaceX with xAI. From Bloomberg:

SpaceX is considering a potential merger with Tesla Inc., as well as an alternative combination with artificial intelligence firm xAI, according to people familiar with the matter, a sign billionaire Elon Musk is weighing how to consolidate his empire.

The firm has discussed the feasibility of a tie-up between SpaceX and Tesla, an idea that some investors are pushing, the people said, asking not to be identified as the information isn’t public. Separately, they are also exploring a tie-up between SpaceX and xAI ahead of an IPO, some of the people said.

Any transaction could attract sizeable interest from infrastructure funds and Middle Eastern sovereign investors, some of the people said. A deal could also potentially require a large financing component, one of them said.

No final decisions have been made, details could change and the companies could decide to remain separate, the people said. Musk and representatives for SpaceX, xAI and Tesla didn’t immediately respond to requests for comment.

SpaceX still seems to actually make money, so it’s a strong horse for Musk to hitch the unprofitable wagon of AI to before the whole bubble pops. Will it help, or just take down the space company? Will merging a space company and a car company that’s pretending to be a robot company be good for either one? Who knows on either count, but one thing’s for sure: The stock prices will always, always go up. 

BYD is now the largest EV-maker in the world, and it’s pulling the Chinese auto market along to new global heights. The nation now accounts for nearly 10% of auto sales in Europe, as the continent keeps buying EVs. From Bloomberg: 

Chinese automakers built nearly one in 10 passenger cars sold in Europe last month, a record share that caps a year of rapid growth led by brisk sales of hybrid and battery-powered vehicles.

With December’s 9.5% share of the European car market, Chinese brands outsold South Korean rivals including Kia Corp. on a quarterly basis for the first time, based on figures from researcher Dataforce. BYD Co. and its peers are poised to make further inroads as trade barriers fall and a Chinese export push accelerates.

The advance was strongest for the electrified cars that account for the bulk of Europe’s growth. Chinese automakers used their competitive edge in battery technology to win customers for EVs and hybrid-electric vehicles from Spain to Greece, Italy and the UK.

Don’t expect this percentage to drop any time soon, and expect to see Canada and Mexico catch up sometime soon. Get ready to learn Chinese, buddy. The age of Western dominance is raging against the dying of the light, but the light’s dying all the same. 

The Trump administration is doing its best to crack down on Californian emissions regulations, which drive the hunt for efficiency in many other U.S. states. California, for its part, is continuing to set emissions restrictions unabated — as it fights the Trump admin in court, it’s still meeting with automakers. From Reuters:

California officials are meeting Detroit automakers this week to discuss the next phase of greenhouse gas regulations for cars and trucks, the state’s top air regulator said.

California is fighting in the courts and in the U.S. Congress against President Donald Trump’s efforts to dismantle landmark federal vehicle emissions standards. Governor Gavin Newsom plans an announcement next week that will lay out details of a new $200 million electric vehicle incentive program that aims to help fill the gap left after Trump’s budget bill killed federal tax credits for new electric cars last year, Lauren Sanchez, chair of the California Air Resources Board, told Reuters in an interview.

…

GM confirmed it was meeting with CARB in Detroit on Thursday and said it “has long history of dialogue and collaboration with CARB” and added “California has the 4th largest economy in the world and is an important market for growth and innovation.”

For decades, California has had some of the nation’s dirtiest air. Other U.S. states have followed its lead in setting rules aimed at reducing harm from pollution.

Infighting between local governments and the national government always goes well, right? How’d it go for the Balkans?

I’m a big proponent of the minivan as Family Truckster, and it seems the rest of the United States is coming around to agree with me. Minivans were up in the U.S. and Canada for 2025, to a degree that seems to surprise everyone involved. From Automotive News: 

Minivans. Mega-comeback. That best describes the people-mover’s popularity in 2025.

The segment that Chrysler, its CEO Lee Iacocca and Hal Sperlich, vice-president of product planning, created for the 1984 model year is enjoying a North American renaissance, finding more uses and new types of buyers.

Automakers sold 42,377 minivans in Canada in 2025, up 34 per cent over the previous year, according to the Automotive News Research & Data Center in Detroit.

“It was the biggest percentage gain of any segment, and every single vehicle in that segment had increased sales, which is really unusual,” DesRosiers Automotive Consultants Managing Partner Andrew King said.

In the United States, 2025 sales were up 20 per cent to 395,352, more than a quarter of which (110,006) were Chrysler Pacificas built in Windsor, Ont.

Volvo says wagons are cool again, now sales data says minivans are cool. Are crossovers now passe? 

And thus, we got the RX-7 and the Miata. Blessed be. 

I’ve been on a big Cherry Glazerr and Daddy Issues kick recently, along with the requisite “The Great Impersonator” from Halsey.