Reddit users criticized Tesla's inter-company transactions with SpaceX, calling it an 'infinite money glitch' that inflates revenue.
A potential Tesla-SpaceX merger was a major topic, with analysts estimating an 80% probability and Reddit debating its implications for S&P 500 index funds.
Tesla launched Full Self-Driving in China and ended Model S production, marking significant strategic shifts.
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Reddit's 'Infinite Money Glitch' Critique
A highly upvoted post on r/wallstreetbets (3,766 upvotes, 378 comments) dissected Tesla's financial relationship with SpaceX, citing a SpaceX prospectus that revealed $506 million in Megapack purchases and $131 million in Cybertruck purchases from Tesla in 2025. The post argued that these inter-company transactions create an 'infinite money glitch,' artificially inflating revenue across Musk's companies. The discussion tapped into long-standing skepticism about Tesla's accounting practices and its reliance on related-party transactions.
On r/ValueInvesting, a post with 599 upvotes warned that Tesla and SpaceX would soon make up nearly 7% of the S&P 500, advising investors to avoid broad market ETFs like VOO and SPY. The author described Tesla as a 'ticking time bomb' with a P/E ratio of 400 and 'horrendous financials,' urging a custom portfolio instead.
SpaceX Merger Speculation Heats Up
Same-day news provided rich context for the Reddit debate. Benzinga reported that Wedbush analyst Dan Ives estimated an 80% probability of a Tesla-SpaceX merger in 2027, following SpaceX's S-1 IPO filing. Ives argued the combined entity would create a unified AI, energy, mobility, and space platform, leveraging Tesla's manufacturing and robotics with SpaceX's Starlink and satellite infrastructure. Another Benzinga article noted that SpaceX's public valuation would establish transparent share-exchange mechanics, potentially enabling the merger.
The merger speculation directly fed into the Reddit narrative about financial engineering. Critics saw the inter-company transactions as a precursor to a larger consolidation that could further obscure Tesla's true financial health, while supporters viewed it as a strategic move to dominate the AI ecosystem.
Strategic Shifts: FSD in China and Model S End
Two other news items added to the day's Tesla story. Benzinga reported that Tesla launched Full Self-Driving (FSD) in China after years of regulatory uncertainty, following President Trump's visit and talks with Xi Jinping. The rollout expands FSD to 10 countries, though Tesla has fallen out of the top 10 EV makers in China due to competition from local players like BYD.
Separately, Tesla ended production of the Model S and Model X after 14 years and over 750,000 units. Since the Model S launch in 2012, Tesla stock has gained over 18,000%. The company is now focusing on robotaxis and the Optimus Bot, which Musk has said could drive a $20-30 trillion valuation.
The Reddit conversation on May 21 reflected a market increasingly focused on the structural dynamics of Musk's corporate empire rather than quarterly earnings. Whether the 'infinite money glitch' narrative or the merger thesis prevails, Tesla remains a lightning rod for retail investor debate.
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