OpenAI will pull its models from Cursor due to SpaceXAI acquisition

OpenAI is planning to cut off Cursor's access from its models, following the AI coding assistant's acquisition by SpaceXAI. In a post on its website, the company said it's giving Cursor users as much time as it could based on its contract. It intends to pull its models from the service on November 12, 2026, but it said that Cursor could choose an earlier termination date. 

The company explained that it's making this choice because it can't be confident that SpaceX will use its technology within its terms of services, based on its "experience with Elon Musk's companies violating contracts." OpenAI and Musk have a long and troubled history, with the SpaceXAI chief being one of the company's earliest investors. He allegedly left in 2018 when OpenAI refused to implement a new board structure he proposed that would give him control of the company.

In 2024, Musk filed a lawsuit to stop OpenAI from transitioning into a for-profit company from a nonprofit organization. He accused OpenAI of violating its founding mission of building AI "for the benefit of humanity" and of telling investors not to fund rival AI firms like xAI. Just this May, a jury ruled against Musk, and the judge in the case dismissed his claims of "breach of charitable trust and unjust enrichment." 

In its post, OpenAI specifically pointed to what Musk admitted during a cross-examination for that lawsuit as one example of how he and xAI had violated its terms of service. Musk admitted that xAI used Open AI's output to train its own models in a process called distillation. OpenAI also previously accused Chinese startups, including DeepSeek, of "distilling" its models. 

"As AI capabilities advance, we also have a new level of accountability to ensure our upcoming model, Astra, is being used in accordance with our terms," OpenAI wrote. "Given all of this, we've decided to hold the contract cancellation to the latest date we can while not providing future models to Cursor." The company recently slowed down Astra's development due to cybersecurity concerns after its AI agents escaped their supposed isolated testing environments and broke into AI platform Hugging Face. 

Cursor co-founder and CEO Michael Truell said in a post on X that OpenAI serves five percent of the tool's customers. He revealed that his team is speaking with the company's in hopes of coming up with a resolution. Meanwhile, Anthropic co-founder Tom Brown said his company will "continue to increase compute to support Claude models in Cursor" and that it's "excited for what comes next with them at SpaceX."