Tesla Shares Steady in Premarket Trade After Musk Calls China Sale Report ‘Fake’ 

Mumbai: Tesla Inc (TSLA) shares closed at $321.55 on Wednesday, down $5.80, or 1.77 per cent, from the previous session, as the stock extended its recent slide. In early trade on Thursday, shares were indicated higher at $322.07, up $0.52, or 0.16 per cent, as of 6:03 AM ET, with bids at $321.85 and offers at $322.31. The stock remains well off its 52-week high of $498.83, having traded as low as $297.38 over the past year. 

The modest recovery came a day after Tesla and chief executive Elon Musk moved to deny a Wall Street Journal report claiming the electric-vehicle maker was exploring a sale or spin-off of its China business, a move the report suggested could clear the way for a potential merger with Musk’s rocket company, SpaceX. Reuters reported that Musk dismissed the story on social media platform X, calling it “absurdly fake news.” 

The Journal, citing people familiar with the matter, said certain Tesla executives had been instructed to prepare for a separation of the company’s China operations, and that advisers had examined options including a sale, spinoff or closure of the unit, along with creating a separate sales entity for exports out of Giga Shanghai. 

Musk rejected the report within hours, writing on X that the idea had “never even come up in a discussion ever.” Tesla’s China unit separately dismissed the claims as “false information.” Hong Kong-based Nikkei Asia, which also covered the denial, reported that questions had mounted over Tesla’s future in the world’s largest car market amid the speculation. 

Why the Report Matters 

The scale of what is at stake explains the swift pushback. The Shanghai facility is Tesla’s biggest and highest-output factory anywhere in the world, responsible for over half of all vehicles the company delivers globally, and it functions as a key shipping hub for customers in Europe, Canada and the Asia-Pacific region. China accounted for roughly 18 per cent of Tesla’s sales in the first half of 2026, and unlike many Western automakers that share ownership of their Chinese plants with local partners, Tesla owns its China manufacturing operations outright. 

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The Bigger Picture 

While the specific China-sale claim has been denied, the broader idea of combining Tesla and SpaceX is not something Musk has kept private. He has openly discussed the possibility of merging the two companies in recent months, citing growing overlap between them, and SpaceX’s chief operating officer, Gwynne Shotwell, has also spoken publicly about the prospect. 

Talk of a tie-up has intensified since SpaceX’s stock market debut, which valued the rocket company at more than 2 trillion dollars. Any formal combination would likely draw significant regulatory scrutiny in both the US and China, given SpaceX’s role as a major American defence contractor and Tesla’s deep manufacturing footprint in China. 

Market Reaction 

Investors have largely treated the episode as unresolved rather than settled, with some market watchers noting that companies sometimes deny discussions that are still at an early stage. Despite the controversy, high-profile investors such as Cathie Wood’s ARK Invest continued adding to Tesla and SpaceX positions through the episode. 

For now, Tesla’s position remains that no plan to sell or separate its China business exists, even as speculation about a longer-term Tesla-SpaceX combination continues to build. 

Source

• Reuters
• https://asia.nikkei.com/business/automobiles/electric-vehicles/tesla-denies-sale-of-china-business-amid-spacex-merger-buzz
• https://www.reuters.com/legal/transactional/teslas-china-footprint-complicates-path-possible-spacex-merger-2026-08-04/