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OpenAI to Cut Off Model Access for SpaceX-Owned Cursor in November

OpenAI cited a history of contract violations by Musk-affiliated companies in ending the four-year partnership

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Summary

  • On August 28, OpenAI notified SpaceX that it would end its model-supply agreement for Cursor effective November 12
  • SpaceX closed its roughly $60 billion acquisition of Cursor on August 15, putting Cursor under the same roof as xAI
  • OpenAI said it is ending the contract because of past violations of its terms of service by Twitter and xAI

OpenAI announced on August 28 that it will end its agreement to supply models to the coding tool Cursor, effective November 12. In an official statement, OpenAI said, "We cannot be confident that SpaceX will use our technology within the bounds of our usage policies." The company noted that its contract includes a window for termination following a change of control, and it chose the latest possible date within that window so developers could keep access for as long as possible.

A diagram shows OpenAI's supply relationship with Cursor being cut, represented by a dotted arrow. Following the SpaceX acquisition, Cursor is shown grouped in the same circle as xAI, and as a result, the arrows pointing to developers show narrower options.A diagram shows OpenAI's supply relationship with Cursor being cut, represented by a dotted arrow. Following the SpaceX acquisition, Cursor is shown grouped in the same circle as xAI, and as a result, the arrows pointing to developers show narrower options.

Cursor is a coding editor with AI built deeply into the writing experience, letting developers switch between Anthropic's Claude, OpenAI's GPT, and Google's Gemini from within the app, while also training its own in-house model, Composer. SpaceX and Cursor announced a partnership in April, followed by an acquisition announcement in June, and the roughly $60 billion (about 83 trillion won) deal closed on August 15 — placing Cursor under the same corporate umbrella as xAI, SpaceX's AI subsidiary. That's exactly the arrangement OpenAI took issue with. OpenAI pointed out that after Musk acquired Twitter (now part of SpaceX), that company violated the terms of several contracts, including OpenAI's, and that Musk himself admitted under oath earlier this year that xAI had violated provisions similar to OpenAI's usage terms. OpenAI typically relies on custom agreements with major partners to confirm compliance with its safety standards, and it said that trust has now been broken. OpenAI also cited the fact that it is preparing to launch its next model, Astra, as a reason for holding partners to an even higher standard of compliance with its terms of service.

The developers most immediately affected are those who have been choosing GPT-series models inside Cursor. OpenAI said it will support these users through the transition, but after November 12, Cursor users will likely find their options narrowed to Claude, Gemini, or Cursor's own in-house Composer model. There have already been reports that, since the SpaceX acquisition, Cursor's internal teams have been given the goal of helping Grok catch up to the market leaders — a push that this contract termination is likely to accelerate.

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