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Elon Musk says Tesla’s competition can’t be seen with a telescope, but the company admits Chinese EV makers are ‘scary’
Tesla has been head and shoulders above competitors in the electric vehicle field for some time due to its maturity as a company and expertise in EV engineering. The fact that very few companies can say they have been developing electric vehicles for as long as Tesla has is where the company’s true advantage lies.
In fact, CEO Elon Musk believes that whoever is in second place, even though he “doesn’t really know who would even be a distant second,” is so far away, you can’t even see them “with a telescope:”
“We still don’t even know really who would even be a distant second. So yes, it really seems like we’re — I mean, right now, I don’t think you could see a second place with a telescope, at least we can’t. So that won’t last forever.”
In the past, Musk has stated Volkswagen was Tesla’s closest competition. But since former group CEO Herbert Diess left late last year, that may have changed.
Volkswagen sold ~99k EVs out of 1.9M in Q1, seeks to gain 10% market share in North America by 2030
Tesla is not only a leader in EV tech, but it also has been extremely resilient through the past few years. As the COVID-19 pandemic disrupted supply chain regularity in 2020, Tesla undoubtedly felt the pressure. Its order log lengthened in nearly every market, while supply continued to dwindle. Even to this day, Tesla executives are notorious for stating the company has a supply problem, and not a demand one.
While companies like Rivian, Polestar, and Lucid, and automotive mainstays like Ford and General Motors, have offered comparable EV options to consumers, some of which performed extremely well in 2022 with sales. But despite this, Musk still maintains that Tesla’s biggest competitors do not lie within the United States. Instead, a foe that was mentioned in previous earnings events was mentioned: the Chinese.
“The Chinese are scary, we always say that,” Lars Moravy, VP of Vehicle Engineering, said.
“I think we have a lot of respect for the car companies in China,” Musk added. “They are the most competitive in the world.”
Complementing their work ethic and drive, Musk also knows the Chinese automotive market is the most competitive, and the largest, on Earth. Tesla still led the Chinese market in 2022 in pure EV sales, but BYD was the country’s largest seller of plug-in vehicles, including plug-in hybrid EVs. However, most EV enthusiasts would consider PHEVs irrelevant.
What will it take for companies to catch up to Tesla? The answer likely depends on who you ask. Musk believes nobody is close in terms of solving real-world AI, but there are undoubtedly companies out there that have arguments about that. Mercedes-Benz launched the first Level 3 system in Germany last year, and while it is only operational on the Autobahn, it technically trumps Tesla’s Level 2 system, which is determined by the Society of Automotive Engineers’ guidelines for autonomy.
And, if you ask Consumer Reports, Tesla Autopilot is the seventh-best Advanced Driver Assistance System you can get currently.
Ford BlueCruise, GM SuperCruise ranked as best Driver Assistance systems, Tesla Autopilot ranks 7th
Others might state Waymo, Cruise, and others, who have operational driverless ride-sharing services set up are technically ahead of Tesla. However, these companies are confined to certain areas through geofencing, and they undoubtedly have problems themselves. No suite is close to perfect.
Where Tesla’s true advantage lies is within its infrastructure, as it is the only company to establish a worldwide network of Superchargers that may or may not enable other companies to utilize for their own charging needs soon. Currently, and especially in the United States, you must have a Tesla to utilize this. Fifteen countries in Europe are outliers, as they are a part of Tesla’s Supercharger Pilot Program.
It may take a few years for a clear-cut competitor to emerge that will push Tesla to the brink of relinquishing its crown of “EV leader.”
“So in five years, I don’t know, probably somebody has figured it out. I don’t think it’s any of the car companies that we’re aware of,” Musk said.
I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.
Quotes provided by Motley Fool.
Tesla’s dreams of operating a fully autonomous ride-hailing platform just took a massive step toward reality, as two separate events have indicated the company is perhaps closer than ever to achieving self-driving as a product.
On Thursday, Tesla was granted authorization by the State of Texas to operate driverless vehicles in a commercial manner. On May 28, Senate Bill 2807, passed by the 89th Texas Legislature, took effect after being passed back on September 1, 2025.
The bill establishes a statewide regulatory framework requiring authorization from the Texas Department of Motor Vehicles for companies to operate automated vehicles commercially on Texas roads.
This covers driverless, or SAE Level 4+, operations for passenger transport, meaning Robotaxi, or freight.
Tesla and other companies can self-certify their vehicles and tech as long as they:
- Operate in compliance with Texas traffic laws
- Maintain proper registration, title, and insurance
- Use compliant automated driving systems
- Record onboard activity and handle system failures and glitches safely.
The new authorization, which was first reported by James Stephenson on X, allows companies to utilize their own processes to determine if their vehicles are ready to operate without drivers.
🚨BREAKING:
Tesla has been authorized by the State of Texas to operate driverless vehicles commercially under the new law that took effect today, May 28th, 2026. Tesla has officially self-certified the software running on its robotaxis as Level 4. $TSLA pic.twitter.com/KSJdsvlaW5— James Stephenson (@ICannot_Enough) May 28, 2026
It is a rule that expedites the entire approval process, keeping agencies out of a usually long, lengthy, and frustrating task that is essential to technological advancements. It essentially means Tesla can launch commercial Robotaxi operations at this point.
On the very same day, Tesla continued the momentum as CEO Elon Musk shared a video of Cybercab units autonomously driving off the property at Gigafactory Texas. This is a major step in the story of the Cybercab.
Mass production of the Cybercab started at Giga Texas in April, and it is already heading out of the factory on its own.
Cybercab driving itself out of the GigaTexas factory pic.twitter.com/EwAMVVDjYy
— Elon Musk (@elonmusk) May 28, 2026
These two major events mark a drastic step forward in Tesla’s progress toward Cybercab and the permissions it needs to operate a self-driving ride-hailing service. Tesla is now able to operate autonomously under Texas law by self-certifying, and with the potentially imminent rollout of Cybercab, Tesla’s autonomous dreams are starting to take serious shape.
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.
Elon Musk
SpaceX to become America’s Military data backbone for missiles, drones, and warfighters
The Space Force just handed SpaceX $2.29 billion to build the military’s space internet backbone.
The U.S. Space Force awarded SpaceX a $2.29 billion contract on May 26, 2026 to build the backbone of its Space Data Network, a satellite-based communications system designed to keep American military forces connected anywhere on Earth in real time. The contract is firm-fixed-price and requires SpaceX to deliver a fully operational prototype by the end of 2027.
In plain terms, the SDN Backbone is the plumbing behind the military’s space-based internet. It functions as a low Earth orbit satellite constellation providing robust, high-capacity, and low-latency data transport for the Joint Force, connecting sensors and weapons systems continuously, globally, and securely. Think of it as a private, hardened version of Starlink built specifically for battlefield communications, one that soldiers, ships, and aircraft can rely on even in contested environments where ground-based networks have been disrupted.
SpaceX is quietly becoming the U.S. Military’s only reliable rocket
The Space Force was direct about why SpaceX was selected. “The SDN Backbone leverages the best of commercial innovation and delivers a strong foundation for the SDN mission set — a huge benefit and enabler for our warfighters,” said USSF Col. Ryan Frazier.
“We aren’t trading speed for scale; we are demanding both. By using rapid prototyping and Other Transaction Authorities, we are ensuring our advanced solutions are integrated and delivered to the warfighter as fast as possible,” added USSF Lt. Col. Fry, SDN Backbone system program manager.
The SDN Backbone will work alongside the Space Development Agency’s Transport Layer, with the two systems forming a unified open architecture to provide critical data transport for current and future Department of War missions.
As Teslarati has reported, this is not SpaceX’s first Space Force contract of 2026. In April, the Space Force awarded SpaceX $178.5 million to launch missile tracking satellites, and SpaceX is already embedded in the Golden Dome missile defense software group. The $2.29 billion SDN Backbone award puts SpaceX at the center of how the American military communicates in space, a position with direct implications for its reported $1.75 trillion IPO valuation as the company heads toward a public offering as early as June 2026.
Tesla’s Robotaxi dreams just took a massive step toward reality
The Tesla and SpaceX merger everyone is talking about is quietly building
