GE Vernova stock might be facing a new threat: Elon Musk.

His rocket and AI company, SpaceX, might start producing turbine blades for power generation applications, according to a report from The Information, which cited sources. SpaceX and GE Vernova didn't immediately respond to requests for comment.

GE Vernova stock traded as low as $882.14 before recovering to $896.94, down 1.6% in early trading, while the S&P 500 and Dow Jones Industrial Average were off 0.4% and 0.6%, respectively.

Investors might be worried about disruption, with SpaceX turning its engineering might toward a new industry. That might be the knee-jerk reaction, but investors might want to think twice.

For starters, turbine blades are some of the most highly engineered, complex parts manufactured in the U.S. They are made of superalloys and are able to withstand temperatures in excess of the blades' melting point, with tiny cooling channels built into structures that are maintained to tiny tolerances. GE Aerospace, which makes jet engines, and GE Vernova, which manufactures power turbines, have spent decades investing in and refining the technology.

What's more, SpaceX might only be making blades, which, if successful, would be a part for GE Vernova. SpaceX would do all this because it sees a lasting bottleneck in blade production that would become a barrier to faster AI adoption. Bottleneck mitigation is why SpaceX is building a semiconductor manufacturing facility with Tesla.

Eventually, SpaceX plans to put data centers in orbit, leveraging the sun and the company's dominant launch capabilities to build low-cost orbital AI compute. Before then, SpaceX, which merged with xAI in February, will rely on terrestrial data centers to build its AI business. Those AI data centers need electricity.

Electricity needs power generation equipment-a lot of it. AI data center projects could add up to 1,300 terawatt-hours of electricity demand by the end of the decade. That would be a 30% increase in U.S. electricity demand. Getting enough turbines to meet that demand is a challenge.

It's one reason that GE Vernova stock is up more than 500% since being spun off from GE Aerospace in early 2024. Shares are down roughly 25% from a record high of almost $1,196 a share reached in June.

Since then, investors have worried that the AI trade had run too far too fast. (A late-July blowup that unwound the AI-heavy hedge fund Situational Awareness didn't help either.) Nvidia's recent earnings report gave investors some confidence that growth would continue through 2027. Still, GE Vernova stock hasn't fully recovered.