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SpaceX execs bullish on BFR as Mars rocket test facilities expand in Texas [photos]
Aerial observations of SpaceX’s McGregor, Texas testing facilities on April 17 revealed an unusually frenetic level of construction and expansion centered around Raptor – the rocket engine intended to power BFR and SpaceX to Mars – and a new test-stand, the purpose of which is currently unknown.
With a minimum of 1200 seconds of hot-fires under its belt, SpaceX’s Raptor propulsion program is likely rapidly approaching the end of what is best described as the experimental phase of testing. While this has not been communicated by SpaceX, it is a logical conclusion following several recent developments. Namely the true beginning of BFR test article fabrication and an impressively bullish level of commitment and confidence in the fully reusable launch system demonstrated in the last few months alone by CEO Elon Musk and President/COO Gwynne Shotwell. While Musk is infamous both within and beyond his companies for painfully impractical development timelines, he demonstrated some level of growing consciousness of that fallibility at 2018’s SXSW, stating that he was working on recalibrating his expectations. Without taking a breath, he reiterated his anticipation for short hop tests of the first full-scale spaceship prototype in the first half of 2019.
SpaceX’s three-bay Raptor test stand as of April 17. The middle bay is currently home to the subscale Raptor test program. (Aero Photo)
While anyone familiar with Musk’s timeline antics may roll their eyes and laugh, far more shocking was Shotwell’s sudden pivot towards a new sense of optimism for the BFR program. At Satellite Conference 2018, the typically reserved and pragmatic executive confirmed beyond any doubt that she had become aggressively bullish on the Mars rocket, stating that she believed the spaceship would be ready for suborbital testing in 2019, while the booster-spaceship system could potentially reach orbit by 2020. Musk and Shotwell’s suggestion that BFR’s first suborbital testing – akin to an extreme version of SpaceX’s Grasshopper and F9R programs – is expected to begin in 2019 meshes well with a recent explosion of activity at Port of San Pedro in Los Angeles, CA, thanks to a combination of land acquisition, successful bureaucracy-wrangling, and the first hints of construction and BFR production. It’s highly unlikely that SpaceX would have chosen to temporarily move BFR prototyping into a giant tent on abandoned dock space rather than waiting for port and city approvals for their permanent port factory if they were not keen on moving full speed ahead with the fully reusable launch vehicle’s development.
SpaceX has completed over 1,200 seconds of firing across 42 main Raptor engine tests. pic.twitter.com/EhxbPjd8Cj
— SpaceX (@SpaceX) September 29, 2017
SpaceX’s Director of Real-Estate Bruce McHugh was less confident when he spoke before Port of San Pedro’s board of commissioners on April 19, although all in attendance expressed a huge amount of excitement at the increasingly likely prospects of a huge SpaceX rocket factory materializing in their neighborhood. Local contractors, economic development representatives, and many other community members were eager for the approval and permitting process to finish up, after which SpaceX is characteristically likely to begin demolition and construction in earnest at Berth 240, the prospective site for the company’s first dedicated BFR factory.
Early phases of in-house BFR structures prototyping is taking shape behind the flaps of a custom-ordered temporary tent, something like 60m long, 30m wide, and ~15m tall at the highest point – half an acre of eccentric but functional space for Mars rocket R&D, in other words. The primary benefit of these facilities’ dock-side locations is the minimization of the transportation hell that SpaceX would have had to suffer through to transport 9m-diameter rocket hardware through downtown Los Angeles – feats that would cost as much as $2.5 million one way each time components had to be moved from the Hawthorne factory to the Port of LA, where it would be finally shipped to Texas or Florida.
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- SpaceX’s first major BFR and BFS fabrication tooling, likely being stored temporarily in a tent at Port of San Pedro. Note the tent framework at the top. (Elon Musk)
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- Just a casual line of car-sized steel segments hanging around outside the BFR tent. (Pauline Acalin)
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- It’s understood that SpaceX will eventually move this work to Berth 240 once more permanent facilities are constructed. (Pauline Acalin)
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- SpaceX’s BFR tent and mandrel, caught on April 14th. (Pauline Acalin)
Speaking at a private talk given to MIT campus members in October 2017, attendees reported that Shotwell stated that although “[BFR’s] composite tanks [would] be a challenge [for SpaceX],” the company was already working on maturing the technologies required, and also noted that SpaceX was “building a larger [version of] Raptor right now.” Half a year later, outsiders have heard nothing of any additional carbon composite propellant tank testing at the new 9m diameter, but the existence of custom-ordered (i.e. very expensive and specialized) composite fabrication tooling of the same diameter as BFR effectively guarantees that SpaceX has settled upon and is confident in its approach to manufacturing the massive composite tankage and structures. Along with a similar line of thought, expensive tooling with a fixed diameter also indicates – albeit with less certainty – that the vehicle’s Raptor propulsion system is not expected to change significantly as BFR marches closer to suborbital and orbital testing. Raptor, in other words, is probably considerably more mature than SpaceX’s composite tankage expertise, itself fairly advanced given the mandrel and additional fabrication tooling already present at Port of San Pedro.
And yet, Shotwell’s most telling display of confidence occurred just a handful of days ago at the TED2018 conference. In a lengthy and fairly well-orchestrated interview with the session’s host Chris Anderson, Shotwell repeatedly and happily made comments indicating that she has become extremely bullish on BFR and BFS in the last several months. In her opinion, BFR (and point-to-point Earth transport) will be deployed “within a decade, for sure.” Prices would nominally be “between business and economy,” or a few thousand dollars per person. Speaking on the trip from Earth to Mars, she estimated a three-month journey with BFR Block 1, “but [SpaceX is] gonna try to do it faster.” She further confirmed that SpaceX intends to build much larger BFRs, meshing with Elon’s suggestions that 2016’s ITS concept is now perceived internally as a sort of BFR Block 2. Perhaps most importantly, she qualified her timeline estimates as “Gwynne-time” when Anderson jokingly deadpanned about the infamous Elon-time. Overall, Shotwell came across as more bullish than she has ever been before on BFR’s development and future prospects, including both point-to-point transport on Earth and crewed missions to the surface of Mars – both of which she expected to begin “within a decade, for sure.” Smirking, she quipped that she was “sure Elon would want us to go faster.”
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- BFR heads to orbit in an updated overview of the Mars rocket. (SpaceX)
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- Note the 2017/early-2018 variant’s single delta-wing and extendable leg pods (silver). (SpaceX)
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- According to Hans Koenigsmann, this vision may actually be incompatible if NASA and the US government are given too much control. (SpaceX)
Not one to end on a quiet note, the typically pragmatic executive finished by describing how she believed that spreading human presence throughout the Sol System was only “the first step [towards] moving to other solar systems and potentially other galaxies; I think this is the only time I ever out-vision Elon.” Interstellar travel and faster-than-light propulsion aspirations aside, Shotwell’s comments mark a fairly incredible shift in attitude toward SpaceX’s far loftier ambitions. Musk seems to be working to recalibrate his timelines to be less naive at the same time as Shotwell’s confidence is steadily growing – the two executives, in other words, appear to be rapidly converging upon a middle ground of pragmatic optimism (that or Musk-time is contagious!).
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- Raptor’s McGregor, TX engine test bays are seen here in April 2018. A subscale Raptor prototype is visible in the center bay. (Aero Photo/Teslarati)
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- A new rocket test-stand takes shape at SpaceX’s McGregor, TX facilities. As of just a few months ago, this site was effectively barren of activity. (April 17, Aero Photo)
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- SpaceX’s Merlin 1D (Vacuum and Sea Level) tests stands, as well as a bay for upper stage static fires. (April 17, 2018 – Aero Photo)
As shown above, the level of construction activity at SpaceX’s Texas testing facilities is fairly impressive and could perhaps be seen as evidence that both Musk and Shotwell are speaking from a place of something approaching pragmatism. While the purpose of the new stand (center) is not yet clear, several aspects indicate that it is unlikely to be more mundane. First, the massive water tower (one that did not exist just a month or two ago, might I add) dwarfs anything found at individual engine or upper stage test stands at the SpaceX facility. It’s possible that the existence of the flame trench alone necessitates the inclusion of such a large water suppression system for damage prevention, but the presence of the blue steel skeleton of a new flame bucket (operational iterations shown on the right) suggests otherwise. For example, the Merlin stands have no such water suppression system: they do use water suppression to avoid damaging the ground systems or the engines themselves, but that water is stored in a large ground-level tank. A tower, however, indicates that SpaceX wants much higher water pressures and flow rates to be available at the new stand, a requirement for significantly more powerful tests akin to SpaceX’s full-up Falcon 9 (and Heavy) test stand – the water towers at the S1 stand and this new stand appear to be identical in size.
In other words, it’s more probable than not that this new stand is being built to support either booster static fires or much larger tests of BFR hardware (perhaps multiple Raptors at once, akin to SpaceX’s very early tests of Falcon 9’s nine Merlins). It could, of course, be used for many different tasks, but only time will tell. Given the sheer level of physical progress made in the BFR program and the swelling confidence of Musk and Shotwell, I certainly know where I’d hedge my bets.
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In a striking revelation that underscores the lucrative crossover between Big Tech and space exploration, Alphabet Inc., Google’s parent company, disclosed a massive $94.1 billion equity stake in SpaceX following the rocket company’s blockbuster initial public offering earlier this year.
The disclosure came in Alphabet’s quarterly filing, marking the first time the long-held private investment has been publicly valued at market prices. Google was an early backer, investing alongside Fidelity in 2015 with roughly $500-900 million at a time when SpaceX was valued around $12 billion.
That bet has delivered extraordinary returns, roughly a hundredfold, transforming a strategic play on satellite internet and launch capabilities into one of Alphabet’s largest assets.
Google, $GOOGL, has said they hold $94 billion in SpaceX, $SPCX, shares after IPO.
— unusual_whales (@unusual_whales) July 23, 2026
Of the total holding, approximately $80 billion remains subject to short-term post-IPO lockup restrictions, preventing near-term sales. An additional $14.1 billion faces longer-term restrictions, extending into the third quarter of 2027. This structure limits immediate liquidity but protects against market volatility as SpaceX transitions into public trading.
The SpaceX position contributed significantly to gains in Alphabet’s broader investment portfolio, which also includes a major stake in AI leader Anthropic. Combined, these holdings helped drive nearly $100 billion in investment gains during the second quarter, providing a substantial boost to net income amid ongoing AI spending pressures.
Analysts view the disclosure as validation of Alphabet’s venture strategy beyond its core search and cloud businesses. The investment aligns with deeper ties, including reported multi-billion-dollar deals for AI computing capacity on SpaceX infrastructure. As SpaceX advances Starship flights, Starlink expansion, and ambitious Mars goals under Elon Musk, Google’s stake positions it to benefit from the commercialization of space.
For Alphabet, the windfall highlights how patient, forward-looking bets in transformative sectors can yield outsized rewards. While lockups temper short-term impact, the holding cements SpaceX as a cornerstone of Alphabet’s diversified portfolio in an era where aerospace, AI, and connectivity increasingly intersect. Investors will watch closely as restrictions lift and SpaceX’s public performance unfolds.
In early 2026, Tesla made a bold strategic pivot: it largely eliminated the option to purchase Full Self-Driving (FSD) software outright and shifted to a subscription-only model. The change, effective around mid-February, ended the one-time fee that had previously ranged as high as $15,000 and later dropped to $8,000. Instead, customers would access FSD (Supervised) for $99 per month in the U.S.
At the time, skeptics questioned whether locking customers into recurring payments would hurt adoption or alienate buyers who preferred ownership of the feature. Tesla bet that a lower barrier to entry, seamless integration at purchase, and the ability to cancel at any time would drive higher uptake.
The results from Q2 2026 speak for themselves: the decision has been a resounding success, delivering the largest quarterly growth in FSD subscriptions in the company’s history.
Tesla FSD subscriptions went up 56% in Q2 2026 to 1.48 million, an increase of 200,000 from Q1 2026.
Tesla added more FSD subscribers in Q2 than in any quarter in its history. pic.twitter.com/jTciTD2JqW
— Sawyer Merritt (@SawyerMerritt) July 22, 2026
According to Tesla’s Q2 shareholder update, active FSD subscriptions reached 1.48 million globally by the end of June 2026. That represents a 56 percent increase year-over-year and a 15.6 percent jump from the prior quarter. Tesla added roughly 200,000 new subscriptions in the period alone—the biggest single-quarter gain on record.
North America led the charge, with more than 55 percent of new vehicle deliveries including an FSD subscription at the time of purchase, a record attach rate for the region.
Tesla explicitly noted that “more customers [are] opting for subscription at the time of vehicle purchase,” crediting the model shift and prominent placement of the option in the ordering process. Subscriptions now contribute meaningfully to ancillary revenue, helping offset pressure elsewhere in the business.
The financial upside is substantial: At $99 per month, 1.48 million active subscriptions generate approximately $146.5 million in monthly recurring revenue. Over a full year, that equates to roughly $1.76 billion in annualized recurring revenue (ARR) from FSD subscriptions alone, assuming steady retention and no major pricing changes.
These figures represent pure, high-margin software revenue. Unlike vehicle sales, which carry production costs, warranty obligations, and supply-chain risks, FSD subscriptions flow largely to the bottom line once the software is developed and deployed over-the-air.
Tesla does not break out exact FSD subscription revenue in its filings (it sits within “Services and Other”), but the category grew 50 percent year-over-year in Q2, with executives highlighting subscriptions as a key driver.
The subscription model offers several structural advantages. It lowers the upfront cost of a new Tesla, potentially broadening the buyer pool and supporting vehicle demand, especially important amid fluctuating EV market conditions. It creates a predictable revenue stream that compounds as the fleet grows and more owners try (and stick with) the software.
Legacy one-time purchasers still exist, but new growth is overwhelmingly subscription-based following the February cutoff.
Early data also suggests improving retention and satisfaction, as well. Tesla has rolled out iterative FSD updates, including v14 features, and expanded availability to additional markets. Recent regulatory approvals in parts of Europe have further boosted interest, with owners in newly enabled countries eager to activate the software they had been waiting for.
FSD is still supervised; regulatory hurdles for true unsupervised autonomy persist in many regions, including the United States, and competition in advanced driver-assistance systems is intensifying. Yet the Q2 numbers validate Tesla’s bet: by removing the large upfront commitment and making FSD accessible via subscription, the company has accelerated adoption faster than many anticipated.
What began as a controversial switch-up has become a clear win. With nearly 1.5 million subscribers, record attach rates, and nearly $1.8 billion in potential annual recurring revenue already in view, Tesla’s FSD business is transitioning from a promised future to a tangible, fast-growing profit engine.
If the momentum continues, and especially if unsupervised capabilities unlock robotaxi opportunities, the subscription flywheel could become one of the most valuable assets in Tesla’s portfolio.
Tesla Robotaxi is among its biggest projects currently, but many have been quick to point out the fact that the company has definitely been slow to expand its fleet.
However, there is definitely a method to that madness. CEO Elon Musk answered several concerns during last night’s quarterly earnings call that some might have about that slow rollout of the Robotaxi suite, maintaining the company’s narrative on prioritizing safety and wanting to avoid injuries to anyone, including animals.
Musk said:
“With Robotaxi, our goals are very ambitious for Robotaxi, but we do need to be cautious about causing any accidents or causing any harm to anyone. Although there are, I think, 30,000 to 40,000 automotive deaths per year in the U.S. alone, most of those do not generate any press or maybe, you never really read about almost any of those. If we injure even one person, it’ll be worldwide headline news, and regulators will immediately clamp down on our activities.
We don’t want to injure anyone. We’re going as fast as humanly possible in scaling Robotaxi, but while trying to ensure that we do not harm anyone at all, and ideally do not even run over a pet. That’s really the constraint is we want to grow as fast as possible with Robotaxi without harm to anyone.”
Tesla has maintained an exemplary safety record with its Robotaxi suite, according to internal data. VP of AI, Ashok Elluswamy, said that the Robotaxi suite has driven more than 380,000 miles unsupervised without any incidents.
0 notable incidents across over 380,000 miles traveled by Robotaxi
— Tesla (@Tesla) July 22, 2026
Analyst Colin Langan of Bank of America also pushed Tesla executives for answers regarding the company’s decision to add cities across several states with dozens of vehicles “as opposed to hundreds.”
Elluswamy said there’s a bigger advantage to do it the way Tesla has been because it ensures that its software stack “is a very general one:”
“The reason we have been expanding across different cities instead of just doubling down on a single city, is that we want to make sure that our stack is a very general one. It is a general one. We just want to both prove to ourselves and to other folks that it is working across a lot of different cities without too much effort per city. That’s what we see internally.”
In the past, we have written about Tesla’s decision to be incredibly conservative with its Robotaxi rollout, especially with the incredibly small fleet size compared to competitors. However, there really is not a price anyone can put on safety for those utilizing the platform or pedestrians, so what Tesla is doing is justified.
A year into the Robotaxi program being active, Tesla has made major strides, but many investors and fans would like to see the fleet expand as quickly as the program has to other cities and states.
Google’s massive stake in SpaceX will shock you
Tesla’s switch-up on selling Full Self-Driving has paid off big time
