Tesla's electric vehicle business in China looms as a key hurdle to a potential merger between Elon Musk's automaker and SpaceX because of complications it could pose for the space firm's business with the U.S. government.
The prospect of a merger between the companies, each valued at more than $1 trillion, has tantalized investors and analysts in recent months, particularly during SpaceX's record $75 billion initial public offering process in June. Musk fanned the flames on Tesla's earnings call last month when he cited growing overlap between the companies. The Wall Street Journal last week reported the automaker's executives had been told to prepare for a separation of its China business ahead of a potential merger.
