Texas’ Next Attorney General Vows “Tremendous Scrutiny” of a Tesla–SpaceX Merger Omor Ibne Ehsan Sat, November 14, 2026 at 11:44 AM EST 6 min read TSLA SPCX TMUS Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Texas attorney general-elect Nathan Johnson promises "tremendous scrutiny" of any merger between Tesla and SpaceX, though he has announced no investigation and does not take office until January 2027.
Texas antitrust law lets the attorney general issue document demands and seek injunctions, which could delay a closing even if the state would struggle to win in court.
Tesla holders have more to lose from a delay than SpaceX, because much of Tesla's valuation depends on what a combination might deliver.
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Nathan Johnson is Texas' attorney general-elect. He said in an interview on Thursday, November 12, published November 13, 2026, that any merger of companies as important as Tesla (NASDAQ:TSLA) and SpaceX (NASDAQ:SPCX) would get "tremendous scrutiny."
Both of these Elon Musk companies are incorporated in Texas, and their merger talks have been reported to be moving toward an announcement as soon as December. Johnson does not take office until January 2027. He declined to discuss the details of a combination and has announced no investigation.
Tesla closed at $390.22 on November 13, down 1.82%. SpaceX closed at $139.11, down 0.59%. Other factors likely drove both moves, since SpaceX also launched a Starship test flight during that session. For Tesla shareholders, the open question is whether the attorney general's office in Tesla's home state will become a more critical regulator of Musk's companies.
Johnson is one of the Democrats who won statewide office on November 3, 2026. He follows Ken Paxton, who lost the U.S. Senate race to James Talarico, and Governor-elect Gina Hinojosa and Talarico have also promised to check Musk's power.
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Johnson said Musk has received respect because of his ties to the Republican Party and that he has no hesitation about examining Musk's relationships with the state. He also said he does not want anyone to control government so much that they can use public power for private gain, and he believes Musk's empire is at great risk of crossing that line.
The deal itself remains at an early stage. Special committees of independent directors are leading the talks, no terms are public, and neither company has filed anything. Tesla's own third-quarter release mentioned only "Speculation around a potential Tesla-SpaceX merger."
Texas' Free Enterprise and Antitrust Act of 1983 makes it illegal to buy another company's stock or assets when the effect may be to substantially decrease competition. Under the act, the attorney general can issue civil investigative demands (subpoena-like requests for documents and testimony). The office can also sue in state district court to block a deal temporarily or permanently, and it can sue under federal antitrust law.
Texas joined the multistate lawsuit to block T-Mobile (NASDAQ:TMUS) and Sprint in August 2019. However, those two companies competed directly with each other.
Tesla's overlap with SpaceX is thin by comparison. Tesla sells cars, robotaxi rides and batteries, while SpaceX sells launches, Starlink internet and AI services. The ties they already have raise questions. The ties, including Tesla's $2B investment in SpaceX equity and a jointly developed chip fab at Gigafactory Texas, raise questions about governance more than about competition.
Because of that, Texas would have a hard time winning in court, but document demands and a request for an injunction could delay a closing well before any judge rules on the merits.
Tesla trades at more than 400 times earnings. Its third-quarter operating income fell 55.79% to $718 million as research spending rose.
Much of Tesla's valuation depends on what a combination might deliver, so a delay hurts Tesla holders most. SpaceX, which reported third-quarter revenue of $14.60 billion and net income of $4.40 billion, is better positioned to absorb a wait.
Tesla rose 8.93% in the week ending November 13, which included the reports that talks were advancing. It is still down 13.23% for the year, and the third-quarter results show a car business too small on its own to support the share price.
A new state-level hurdle adds risk to the one outcome that could justify Tesla's valuation. SpaceX already reports Starlink and AI revenue directly, so its results depend less on a deal that may have to get past Texas.
Two dates matter: Tesla's annual meeting is December 3, 2026, and Johnson takes office in January 2027. If a deal is announced and his office sends no civil investigative demands within his first 60 days, his warning will likely have had little practical effect on the deal.
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