Morgan Stanley reported that SpaceX and Tesla are deepening their technological and operational alignment around “physical AI,” with analysts led by Adam Jonas writing that the two companies, both led by Elon Musk, “share tech, talent, and infrastructure in a shared mission of converting energy to intelligence.” SpaceX President Gwynne Shotwell said ahead of the company’s planned IPO that there are synergies and “a convergence” between the firms. Tesla is referenced 71 times in SpaceX’s S-1 registration statement, with 34% of those mentions relating to explicit Tesla-SpaceX collaboration and 41% concerning governance issues and related-party dealings. Morgan Stanley cited a shared chip manufacturing facility, Terafab, being constructed in Texas in partnership with Intel at a total reported construction cost exceeding $119 billion. SpaceX is expected to buy $506 million of Megapacks and $131 million of Cybertrucks in 2025 to support its Colossus compute cluster. The companies are co-developing an agentic platform called Macrohard and each targets 100 gigawatts of annual, vertically integrated solar manufacturing capacity in the United States. SpaceX supplies Tesla with compute projected to reach 4.9 gigawatts by the end of 2027 and 15.3 gigawatts of terrestrial compute capacity by 2031, while Starlink provides satellite connectivity Tesla is rolling out starting with the Cybercab.