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Tesla is looking to build on-site housing for Gigafactory 1 employees, says Elon Musk
At some point in the future, some employees working at Tesla’s Gigafactory 1 in Nevada would be able to simply walk or bike to their homes after a shift at the massive facility. Tesla is looking to expand Gigafactory 1, with Elon Musk recently stating during a conversation with NV Gov. Brian Sandoval that he envisions the company to hire more than 20,000 people for the factory. To help house this upcoming influx of workers, Musk noted that Tesla is looking to create an on-site housing compound in Gigafactory 1’s premises.
Tesla’s NV Gigafactory is less than 30% complete, but it already employs roughly 7,000 people. During a technology and innovation summit held at the factory on Tuesday, Elon Musk stated that in order for Gigafactory 1 to hit its target number of employees, the area needs to offer more infrastructure, such as schools, buildings, roads, and affordable housing. As a way to address the need for more housing units for Gigafactory 1’s future workers, Musk noted that Tesla is considering a project that involves building a housing compound for its employees.
“The biggest constraint on growth here is housing and infrastructure. We’re looking at creating a housing compound on site at the Gigafactory, using kind of high-quality mobile homes,” Musk stated.
Nevada’s real estate market was affected by the arrival of Gigafactory 1. The state of Nevada took a blow during the housing crash and recession, and by 2010, the state had a 14% unemployment rate, with more than 175,000 Nevada residents being unemployed. When Brian Sandoval became governor after winning the 2010 race, Nevada was ranked as one of the worst states in terms of bankruptcies and home foreclosures. To push the state’s recovery, Sandoval worked to attract tech companies to set up shop in the state. One of these companies was Tesla, which chose Nevada as the site for its Gigafactory 1.
Gigafactory 1 is located about 25 miles east of Reno, NV. For now, many of the facility’s employees live in Reno, as well as several surrounding cities linked to the battery factory via I-80 and the newly-completed Hwy 50, such as Carson City, Fernley, and Sparks. Real-estate prices in areas around Gigafactory 1 have risen over the past years. In Reno alone, the average monthly rent is now $1,318 per month, a 58% increase over rental rates six years ago. In the Reno/Sparks area, median home prices recently hit an all-time high, reaching $389,000 in July. Considering Musk’s new guidance, Gigafactory 1’s employees would almost triple once the facility is complete. Thus, there is definitely a need for practical, affordable housing around the facility.
It remains to be seen what type of housing Tesla would introduce for Gigafactory 1’s employees. That said, the housing initiative does go in line with some ideas that Elon Musk recently expressed. During his now-infamous podcast with Joe Rogan, for one, Musk teased the concept of a smart home with a more efficient air conditioning system. Musk’s side venture, The Boring Company, has also developed the Boring Bricks, which are designed as a cost-effective way to construct homes. Considering Elon Musk’s penchant for the creative, there is a good chance that Tesla’s on-site housing compound at Gigafactory 1 might feature some notable elements as well.
The concept of the mill towns, or settlements that are built around factories, have been around since the late 1800’s. In recent years, some of Silicon Valley’s most prominent companies have explored a rather similar concept. Last year, for example, Google and Facebook issued a proposal to build self-contained towns near their respective headquarters. These towns would feature amenities such as their own grocery stores, shops, cafes, movie theaters, gyms, and hundreds of apartments that can accommodate the companies’ expanding employee base. If Elon Musk’s words would prove to be true, it might only be a matter of time before a sort of “Tesla town” emerges just outside of Reno, Nevada.
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 dedicated factory for building up to ten million Optimus units is officially under construction at Gigafactory Texas.
Drone footage released on May 27 by Giga Texas observer Joe Tegtmeyer captures the significant milestone of the first steel structure officially standing at Tesla’s new Optimus factory on the North Campus of the facility.
Phase two of land reclamation is advancing steadily, and the progress will let the new building extend nearly the full length of the main Giga Texas factory, potentially exceeding 4,000 feet, while measuring somewhere between 50 and 70 meters narrower. Extensive foundation work is proceeding as well.
Big news at the new Optimus 10m/y factory construction site today! The 1st steel structure has been erected & as expected the second phase of land reclamation is underway.
This will allow this new factory to grow to nearly the same length as the main Giga Texas factory,… pic.twitter.com/FidRLV6XpU
— Joe Tegtmeyer 🚀 🤠🛸😎 (@JoeTegtmeyer) May 27, 2026
This facility forms a central element of Tesla’s broader North Campus expansion at Giga Texas. The project will add more than 5.2 million square feet of new industrial space. It sits alongside other advanced developments, including a Terafab for next-gen AI chips. The scale reflects Tesla’s commitment to transforming humanoid robotics into a core pillar of the company’s future.
Musk has said that Optimus will be the biggest product in the world on several occasions. He believes it will be Tesla’s biggest valuation contributor.
Tesla prepares to expand Giga Texas with new Optimus production plant
Tesla plans to build about 10 million robots at the site annually once it is completed, which would be about 27,000 units each day.
The Optimus plant at Giga Texas is part of Tesla’s phased strategy for Optimus manufacturing. In an effort to start production of the robot well before the Giga Texas plant is complete, Tesla ended production of the Model S and Model X vehicles, which were built in Fremont, California, to make way for initial Optimus manufacturing efforts.
Production there will start in either July or August of this year, and early units will support internal factory tasks while the team gathers real-world data to refine processes. The Gigafactory Texas facility will house a second-gen production line. It targets high-volume output starting in Summer 2027.
Musk has repeatedly described Optimus as potentially more valuable than Tesla’s entire vehicle business. Current versions are already completing minor tasks around various facilities, while Tesla continues to refine its abilities and add new features.
Tesla’s total investment could reach several billion dollars. Significant challenges lie ahead, including the creation of an entirely new manufacturing ecosystem, the refinement of AI systems for dependable autonomy, and the development of reliable supply chains for actuators, sensors, and other components.
Nevertheless, the visible progress at Giga Texas highlights Tesla’s capacity to translate ambitious concepts into physical reality.
Tesla’s Optimus factory stands as much more than a simple expansion project, as it is quite literally the second phase of what could potentially be the biggest product ever. With construction beginning, 2027 is poised to become a transformative year for Tesla, as it evolves even further from an electric vehicle leader into a pioneer of intelligent, general-purpose machines.
The Tesla and SpaceX merger everyone is talking about is quietly building
SpaceX to become America’s Military data backbone for missiles, drones, and warfighters
