SpaceX
SpaceX CEO Elon Musk says that BFR could cost less to build than Falcon 9
SpaceX CEO Elon Musk believes that there may be a path for the company to ultimately build the massive Starship spacecraft and Super Heavy booster (formerly BFR) for less than Falcon 9/Falcon Heavy, a rocket 3-9 times smaller than BFR.
While it certainly ranks high on the list of wild and wacky things the CEO has said over the years, there may be a few ways – albeit with healthy qualifications – that Starship/Super Heavy production costs could ultimately compare favorably with SpaceX’s Falcon family of launch vehicles. Nevertheless, there are at least as many ways in which the next-gen rocket can (or should) never be able to beat the production cost of what is effectively a far simpler rocket.
This will sound implausible, but I think there’s a path to build Starship / Super Heavy for less than Falcon 9
— Elon Musk (@elonmusk) February 11, 2019
Dirty boosters done dirt cheap
On the one hand, Musk might not necessarily be wrong, especially if one throws the CEO several bones in the interpretation of his brief tweet. BFR at its simplest is going to require a full 38 main rocket engines to achieve its nominal performance goals, 7 on Starship and 31 on Super Heavy. As a dramatically more advanced, larger, and far more complex engine, Raptor will (with very little doubt) cost far more per engine than the relatively simple Merlin 1D. BFR avionics (flight computers, electronics, wiring, harnesses) are likely to be more of a known quantity, meaning that costs will probably be comparable or even lower than Falcon 9’s when measured as a proportion of overall vehicle cost. Assuming that BFR can use the exact same cold gas thruster assemblies currently flying on Falcon 9, that cost should only grow proportionally with vehicle size. Finally, Starship will not require a deployable payload fairing (~10% of Falcon 9’s production cost).
All of those things mean that Starship/Super Heavy will probably be starting off with far better cost efficiency than Falcon 9 was able to, thanks to almost a decade of interim experience both building, flying, and refurbishing the rocket since its 2010 debut. Still, BFR will have to account for entirely new structures like six large tripod fins/wings and their actuators, wholly new thrust structures (akin to Falcon 9’s octaweb) for both stages, and more. Considering Starship on its own, the production of a human-rated spacecraft capable of safely housing dozens of people in space for weeks or months will almost without a doubt rival the cost of airliner production, where a 737 – with almost half a century of production and flight heritage – still holds a price tag of $100-130+ million.
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- BFR shown to scale with Falcon 1, 9, and Heavy. (SpaceX)
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- A September 2018 render of Starship (then BFS) shows one of the vehicle’s two hinged wings/fins/legs. (SpaceX)
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- BFR’s booster, now known as Super Heavy. (SpaceX)
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- Sadly, this is a not a sight that will greet Falcon 9 booster B1046’s fourth launch – Crew Dragon’s critical In-Flight Abort test. (SpaceX)
Adding one more assumption, the most lenient interpretation of Musk’s tweet assumes that he is really only subjecting the overall structure (sans engines and any crew-relevant hardware) of BFR relative to Falcon 9. In other words, could a ~300-ton stainless steel rocket structure (BFR) cost the same amount or less to fabricate than a ~30-ton aluminum-lithium alloy rocket structure (Falcon 9/Heavy)? From the very roughest of numerical comparisons, Musk estimated the cost of the stainless steel alloys (300-series) to be used for BFR at around $3 per pound ($6.60/kg), while aluminum-lithium alloys used in aerospace (and on Falcon 9) are sold for around $20/lb ($44/kg)*. As such, simply buying the materials to build the basic structures of BFR and Falcon 9 would cost around and $7.5M and $5M, respectively.
Assuming that the process of assembling, welding, and integrating Starship and Super Heavy structures is somehow 5-10 times cheaper, easier, and less labor-intensive, it’s actually not inconceivable that the cost of building BFR’s structure could ultimately compete with Falcon 9 after production has stabilized after the new rocket’s prototyping phase is over and manufacturing processes are mature.
*Very rough estimate, difficult to find a public cost per unit mass from modern Al-Li suppliers
Costs vs. benefits
On the opposite hand, stainless steel rockets do not have a history of being uniquely cost-effective relative to vehicles using alternative materials. The only orbital-class launch vehicles to use stainless steel (and balloon) tanks are the Atlas booster and the Centaur upper stage, with Atlas dating back to the late 1950s and Centaur beginning launches in the early ’60s. Stainless steel Atlas launches ended in 2005 with the final Atlas III mission, while multiple forms of Centaur continue to fly regularly on ULA’s Atlas V and Delta IV.
Based on a 1966 contract between NASA and General Dynamics placed shortly after Centaur’s tortured development had largely been completed, Centaur upper stages were priced around $25M apiece (2018 USD). In 1980, the hardware for a dedicated Atlas-Centaur launch of a ~1500 kg Comstar I satellite to GTO cost the US the 2018 equivalent of a bit less than $40M ($71M including miscellaneous administrative costs) – $22.4M for Centaur and $17.6M for Atlas. For Atlas, the rocket’s airframe (tanks and general structure) was purchased for around $8.5M. That version of Atlas-Centaur (Atlas-SLV3D Centaur-D1A) was capable of lifting around 5100 kg (11,250 lb) into Low Earth Orbit (LEO) and 1800 kg (~4000 lb) to geostationary transfer orbit (GTO), while it stood around 40m (130 ft) tall, had a tank diameter of 3.05m (10 ft), and weighed ~150t (330,000 lb) fully fueled.
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- Atlas shows off its shiny steel balloon tanks. (SDASM)
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- The original space-faring Atlas, known as SM-65, seen here with a Mercury space capsule. (NASA)
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- A Centaur upper stage is pictured here in 1964. (NASA)
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- Atlas SLV3D is pictured here launching a Comstar I satellite.
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- A Falcon 9 booster is seen here near the end of its tank welding, just prior to painting. (SpaceX)
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- An overview of SpaceX’s Hawthorne factory floor in early 2018. (SpaceX)
In a very loose sense, that particular stainless steel Atlas variant was about half as large and half as capable as the first flight-worthy version of Falcon 9 at roughly the same price at launch ($60-70M). What does this jaunt through the history books tell us about the prospects of a stainless steel Starship and Super Heavy? Well, not much. The problem with trying to understand and pick apart official claims about SpaceX’s next-generation launch architecture is quite simple: only one family of rockets in the history of the industry (Atlas) regularly flew with stainless steel propellant tanks, a half-century lineage that completed its final launch in 2005.
Generally speaking, an industrial sample size of more or less one makes it far from easy to come to any particular conclusions about a given technology or practice, and SpaceX – according to CEO Elon Musk – fully intends to push past the state of the art of stainless steel rocket tankage with BFR. Ultimately, American Marietta/Martin Marietta/Lockheed Martin was never able to produce launch vehicle variants of the stainless steel Atlas family at a cost more than marginally competitive with Falcon 9, despite the latter rocket’s use of a far more expensive metal alloy throughout its primary tanks and structure.
At least 10X cheaper
— Elon Musk (@elonmusk) February 11, 2019
At some point, it’s even worth asking whether the per-unit cost of Starship and Super Heavy should be relevant at all to their design and construction, at least within reason. If the goal of BFR is to drastically lower the cost of launch by radically improving the ease of reuse, it would be truly bizarre (and utterly unintuitive) if those goals could somehow be achieved without dramatically raising the cost of initial hardware procurement. Perhaps the best close comparison to BFR’s goals, modern airliners are eyewateringly expensive ($100-500M apiece) as a consequence of the extraordinary reliability, performance, efficiency, and longevity customers and regulatory agencies demand from them, although those costs are admittedly not the absolute lowest they could be in a perfect manufacturing scenario.
At the end of the day, it appears that Musk is increasingly of the opinion that the pivot to stainless steel could ultimately make BFR simultaneously “better, faster, [&] cheaper”. However improbable that may be, if it does turn out to be the case, Starship and Super Heavy could be an unfathomable leap ahead for reliable and affordable access to space. It could also be another case of Musk’s excitement and optimism getting the better of him and hyping a given product well beyond what it ultimately is able to achieve. Time will tell!
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Elon Musk
SpaceX’s amended S-1 is sparking a major Tesla merger conversation
A single line in SpaceX’s amended S-1 just sent Tesla stock down 5% in one day.
A single line buried in SpaceX’s amended S-1 filing is doing more to move Tesla’s stock price than anything Tesla itself has announced in months. The clause, disclosed as SpaceX prepares for what could be the largest IPO in Wall Street history, states that the company “may issue a significant amount of equity in connection with future transactions.” While this may be seen as boilerplate language in S-1 filings, the historical ties between SpaceX and Tesla, and with Elon Musk reportedly discussing a possible merger with close colleagues, investors are interpreting it as something closer to a signal.
The concern among institutional investors like Gary Black, managing director of The Future Fund, pointed directly to the amended filing on X, saying it “strongly suggests more SPCX equity will be issued,” which could potentially be used to acquire Tesla. He estimated such a deal could be 28% dilutive to Tesla shareholders since SpaceX would likely command a significantly higher valuation multiple. Black added that institutional investors he knows hate the idea of a combination because they prefer pure plays over conglomerates, which he said “nearly always gravitate to the lowest common multiple.”
The Tesla and SpaceX merger everyone is talking about is quietly building
The bull case runs the math differently. Tesla influencer and retail shareholder advocate AleXandra Merz pushed back on what she called a widespread misunderstanding of how merger-of-equals deals actually work. Rather than simply splitting the difference between two market caps, a merger exchange ratio is negotiated based on relative fair market values, meaning the lower valued company typically sees its stock reprice upward toward the deal value.
Under her model, SpaceX enters at a $2.5 trillion valuation and Tesla at $1.6 trillion, producing a combined entity worth $4.1 trillion split evenly between both shareholder groups. That implies Tesla’s side of the deal would be valued at $2.05 trillion, a gain of roughly $450 billion from its current market cap. She cited Dow-DuPont and CBS-Viacom as historical examples of how markets reprice both companies toward the announced exchange ratio after a deal is unveiled.
What does a Merger of Equals mean to Elon’s compensation packages?
Well, it changes everything.
Enjoy https://t.co/uekCldyITw pic.twitter.com/kolq1C9qTu
— AleXandra Merz 🇺🇲 (@TeslaBoomerMama) June 1, 2026
The SpaceX S-1 amendments also revealed just how much financial infrastructure already binds the two companies together. As Teslarati has reported, SpaceX purchased $697 million in Tesla Megapacks, $131 million in Cybertrucks, and the two companies have shared supply chain resources, and semiconductor fabrication plans since well before any merger conversation became public. A retail poll by Tesla influencer Sawyer Merritt is finding that 36% of respondents do not plan to buy SpaceX shares at IPO and 15.3% saying their decision depends on the valuation.
Do you plan on buying @SpaceX stock at its IPO?
— Sawyer Merritt (@SawyerMerritt) June 1, 2026
Whether the merger happens or not, the amended filing is seemingly moving markets and sharpened a debate that is no longer theoretical. SpaceX is weeks away from trading publicly, and Tesla shareholders are now watching every word of every filing for clues about what Musk plans to do next.
Elon Musk has firmly denied recent media reports suggesting that SpaceX has reduced its target valuation for an upcoming initial public offering.
The denial came directly from the SpaceX and Tesla frontman on his social media platform X, where he responded with a single word, “False,” to a post from ZeroHedge that cited Bloomberg sources.
This swift rebuttal underscores Musk’s ongoing effort to manage speculation surrounding one of the most anticipated market debuts in recent history.
False
— Elon Musk (@elonmusk) May 29, 2026
According to the disputed reports, SpaceX had lowered its IPO valuation goal to at least $1.8 trillion from previous ambitions exceeding $2 trillion.
The claims emerged amid growing anticipation for the company’s confidential S-1 filing, which positions it for a potential public listing as early as June.
Some had pointed to strong revenue growth, particularly from the Starlink satellite internet service, which contributed heavily to the firm’s 2025 figures of $18.7 billion. Yet challenges persist in other areas, including substantial investments and losses tied to ambitious projects like Starship development and artificial intelligence initiatives, which plan to make life multiplanetary eventually.
Musk’s response highlights a pattern in which he actively counters what he views as inaccurate portrayals of his companies’ trajectories.
SpaceX, already valued privately at extraordinary levels, stands as a cornerstone of Musk’s empire alongside Tesla and xAI. The entrepreneur has long emphasized the transformative potential of reusable rockets and global broadband access, factors that fuel investor enthusiasm despite operational hurdles.
By rejecting the valuation downgrade narrative, Musk signals confidence in SpaceX’s fundamentals and its readiness for public markets on terms favorable to its long-term vision. People have been waiting a very long time to invest in SpaceX, and the valuation, as well as the introductory share price, is not going to need adjusting.
They’ll have plenty of suitors.
This episode reflects broader dynamics in the technology sector, where rumors often swirl around high-profile entities. Musk’s direct engagement with media narratives serves to maintain transparency and control the narrative around his ventures.
As SpaceX prepares for greater scrutiny in public markets, the founder’s denial reinforces optimism about its prospects. Supporters argue that the company’s innovative edge positions it for enduring success, far beyond short-term valuation debates. With the denial now public, attention turns to forthcoming regulatory filings that could provide clearer insights into SpaceX’s strategy and financial health.
The coming weeks promise to reveal more about how SpaceX will transition into a publicly traded powerhouse.
Elon Musk
The Tesla and SpaceX merger everyone is talking about is quietly building
Tesla and SpaceX may be closer to merging than Wall Street or either company is admitting.
Elon Musk has reportedly discussed merging Tesla and SpaceX with people close to him, according to CNBC, which cited sources familiar with the conversation. Tesla employees have long expected such a transaction and the topic is openly discussed internally, according to internal sources. With SpaceX is days away from kicking off its Wall Street roadshow for what could be the largest IPO in market history, this would be the first time the company will have public market currency to execute a stock-for-stock deal with Tesla.
The financial logic for a merger would make sense. A combined SpaceX and Tesla would create a conglomerate spanning rockets, satellites, electric vehicles, AI infrastructure, and energy storage valued at roughly $3.35 trillion to $3.6 trillion based on SpaceX’s IPO target range and Tesla’s current market capitalization. The two companies are already more intertwined than most people realize. SpaceX bought $697 million worth of Tesla Megapack systems for xAI data centers and $131 million worth of Cybertrucks. Tesla invested $2 billion in xAI, which subsequently merged with SpaceX. Past transactions also include Tesla selling solar equipment and parts to SpaceX, and SpaceX helping with Cybertruck materials.
Will Tesla join the fold? Predicting a triple merger with SpaceX and xAI
Musk himself signaled where this was heading in November 2025 when he posted on X, “My companies are, surprisingly in some ways, trending towards convergence.” Tesla and SpaceX announced a joint semiconductor fabrication facility in Austin called Terafab on the Gigafactory Texas campus, covering two advanced chip factories, with one serving Tesla’s AI needs for vehicles and Optimus robots, the other targeting space-based data centers under SpaceX’s infrastructure vision.
Wedbush analyst Dan Ives places the probability of a merger at 80% to 90% with a target completion in the first half of 2027. The mechanics of a deal became possible the moment SpaceX filed its S-1. Legal experts said a merger likely would not spark antitrust issues but would raise concerns among shareholders in each company, with questions around which company would be the parent, how a stock swap would take place, and who determines the appropriate price. Musk holds about 20% of Tesla’s equity but controls 85.1% of SpaceX’s voting power through a super-voting share class, meaning he would largely be negotiating the terms with himself.
Not everyone is convinced the timing is imminent. Traders on Kalshi place only 33% odds that a merger will happen before May 2027. The more immediate concern for Tesla shareholders is whether the SpaceX IPO pulls capital and Musk’s attention away from Tesla before any merger consolidates the upside for both.
What is clear is that the structural groundwork is already being laid. The Terafab announcement, the xAI merger, the shared supply chain, the cross-company balance sheet transactions, and now the IPO all point in the same direction. Whether the merger follows in 2027 or later, the two companies are already operating more like divisions of a single entity than independent competitors.
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