Elon Musk Reportedly Used SpaceX As 'Piggy Bank' To Give Himself, Tesla A Leg Up

Elon Musk Reportedly Used SpaceX As ‘Piggy Bank’ To Give Himself, Tesla A Leg Up

April 27, 2026

Daragh Thomas

Tue, April 28, 2026 at 12:31 AM UTC

Elon Musk borrowed $500 million from SpaceX at interest rates as low as 1%, used the rocket company to bail out a struggling solar venture, and most recently had SpaceX swallow his cash-burning AI lab, according to a New York Times investigation published Friday.

The report lands six weeks before SpaceX is expected to hit the road with the largest IPO in history.

Musk pulled three loans totaling $500 million from SpaceX between 2018 and 2020, at rates that ranged from under 1% to nearly 3%, according to the Times.

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The prime rate sat closer to 5% for most of that period. Under the 2002 Sarbanes-Oxley Act, public companies cannot lend to senior executives. SpaceX could because it is private.

SpaceX also lent Tesla Inc. $20 million during the 2008 crisis, per Musk’s own earlier comments. It injected $255 million into SolarCity in 2015 when the debt carried a high default risk.

And this year, SpaceX acquired xAI after Musk said the AI venture was “not built right.” At least seven xAI co-founders have since quit, and Musk said the venture was “being rebuilt from the foundations up.”

Law professor Ann Lipton told the Times the arrangements were “conflicted transactions” and a “hazard” of investing with Musk.

Polymarket traders still give SpaceX a 72% chance of IPOing by June 30, with the December 31 contract at 94%. The closing market cap contract splits between $1.5-$2 trillion at 36% and $2-$2.5 trillion at 28%.

None of the timing contracts moved meaningfully on the NYT story, suggesting traders view the disclosures as already priced in given the dual-class share structure Musk is building into the offering.

Peter Thiel‘s Founders Fund, one of SpaceX’s largest outside backers, has been concerned that Musk is prioritizing his interests over other shareholders.

The xAI deal diluted their stake in SpaceX.

Tesla has been the most liquid Musk trade for years. A 2024 Cleveland pension fund lawsuit accused Musk of diverting Nvidia chips from Tesla to xAI, and Tesla overrode a shareholder vote in January to put $2 billion into xAI anyway.

NYU’s Aswath Damodaran, who says SpaceX is likely to be roughly 30% overvalued, put it bluntly: “You get the package. You get the Musk package, the good stuff, the bad stuff.

It’s not fair complaining about the things about Musk you don’t like because they come bundled in.”

The S-1, expected in May, will force every related-party transaction into daylight for the first time.

Image: Shutterstock

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