After Beating TSLA in EVs, is China Eyeing Musk's SpaceX Ambitions?

After Tesla TSLA lost its electric vehicle (EV) crown to China’s BYD Co Ltd BYDDY, CEO Elon Musk may now be facing an even bigger challenge, and this time in space. As Musk’s SpaceX prepares for a high-profile IPO, China’s growing ambitions in orbital artificial intelligence (AI) data centers are adding a new layer of competition.BYD Dethrones TeslaIn 2025, BYD overtook Tesla to become the world’s largest EV seller for the first time on an annual sales basis. BYD sold around 2.25 million electric-powered vehicles, up roughly 28% year over year. Tesla, meanwhile, reported two straight years of falling sales and profits. Several factors weighed on Tesla, including an aging product lineup and stiff competition from Chinese automakers. Also, investors grew uneasy about Musk’s political involvement. BYD, on the other hand, benefited from scale, pricing power and strong domestic demand in China.But what began as competition around Tesla is now expanding into other areas of Musk’s technology empire.China Enters the Space AI RaceChina’s primary space contractor, the China Aerospace Science and Technology Corporation (“CASC”), has announced plans to launch space-based AI data centers over the next five years, per Reuters. These systems aim to integrate cloud, edge and device-level computing.Basically, China wants data collected on Earth to be processed directly in orbit. This approach could improve speed, reduce transmission needs and allow more complex AI tasks to run off-planet.The timing is striking. Just as SpaceX is contemplating an IPO centered on orbital AI ambitions, China is signaling that it plans to compete head-on in the same space. After BYD dethroned Tesla in EVs, the parallels are hard to ignore.SpaceX’s Big Bet: AI Data Centers in OrbitSpaceX is preparing for what could be one of the largest IPOs in recent history. A major part of that story is AI.Musk wants SpaceX to deploy AI data centers in orbit. Data centers on Earth are running into energy limits. Power grids are stretched, electricity costs are rising and cooling massive AI servers is becoming harder. Space, by contrast, offers abundant solar energy and natural cooling.SpaceX plans to launch solar-powered AI data center satellites within the next two to three years. These orbital systems could process data directly in space, reducing pressure on Earth-based infrastructure and opening new possibilities for AI workloads.SpaceX is not alone in this race. Several global technology leaders, including Alphabet GOOGL, NVIDIA NVDA and Blue Origin, are actively exploring space-based data centers.Efforts by Google, NVIDIA & Blue OriginGoogle has launched Project Suncatcher, an initiative to place AI computing hardware into orbit using solar-powered satellites. By early 2027, Google plans to test two prototype satellites equipped with its own AI chips to see if they can reliably run in space. If successful, these tests could lay the groundwork for future space-based data centers, helping address the growing energy demands of advanced AI.Meanwhile, NVIDIA is actively supporting space-based AI through its GPU technology. In late 2025, Starcloud, a startup backed by NVIDIA, launched Starcloud 1, carrying an NVIDIA H100 GPU. The satellite successfully trained and ran AI models in orbit, including a version of Google’s Gemma, marking the first AI model training in space. For Nvidia, it proved that its hardware can operate beyond Earth.Jeff Bezos’ Blue Origin is also exploring the field, with dedicated teams developing systems to support AI workloads in orbit. Drawing on its deep experience in rocket and space technologies, Blue Origin sees orbital computing as a natural extension of the AI boom.Together, SpaceX, Google, NVIDIA and Blue Origin are shaping the next frontier of computing in space.A New Tech Battlefield Beyond EarthSpace is indeed becoming the next major battleground for technology leadership. SpaceX wants to fund orbital AI through its IPO. China would be moving fast through CASC. NVIDIA is proving AI can run in orbit. Google is testing solar-powered AI satellites. Blue Origin is building the foundation quietly.The coming years, particularly prototype launches planned around 2027, will show whether space-based data centers can scale— and whether China’s ambitious plans will directly challenge SpaceX’s position in orbital AI.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.See Our Newest 5 Stocks Set to Double Picks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NVIDIA Corporation (NVDA): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report Byd Co., Ltd. (BYDDY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks