OpenAI is ending its contract with the AI coding tool Cursor following SpaceX’s acquisition of the company, citing Elon Musk’s history of breaking agreements.
The termination takes effect on 12 November 2026. This date represents the maximum notice period permitted under the original deal, which contains a clause allowing OpenAI to end the partnership after a change in ownership. SpaceX’s purchase of Cursor activated this provision. OpenAI states it cannot be confident that SpaceX will adhere to the terms of service.
“It boils down to trust,” Thibault Sottiaux, a representative for OpenAI, says. Users accessing GPT models through Cursor will retain the ability to use their own OpenAI API keys. OpenAI will also continue to provide access via its IDE extensions for Cursor. Sottiaux emphasises that this is a specific move against Musk, not a rejection of the wider AI coding tool landscape or its developer community.
Musk’s companies have a track record of breaking contracts, OpenAI says
The suspension is the latest chapter in a years-long feud between Musk and OpenAI that has also played out in court. OpenAI specifically accuses Musk of breaching contracts following his acquisition of Twitter and of attempting to extract data. The AI lab had a licensing deal with Twitter that granted the company access to the full tweet data feed for approximately $2 million a year to train ChatGPT. When Musk discovered the agreement in December 2022, he deemed the price too low and cut off OpenAI’s access.
Musk also admitted during the legal battle that he used data from other labs’ AI models to train his own Grok models, a practice known as “distillation.” That, too, violates OpenAI’s terms of service.
OpenAI is also framing this as a safety issue. With the upcoming Astra model, which reportedly has advanced cyber capabilities, there is “a new level of accountability” to ensure partners comply with the terms of service. For a company that has spent years warning about the risks of AI, the implication that previous accountability standards were somehow sufficient is a curious one.
Cursor says OpenAI accounts for just five percent of its AI traffic
Cursor co-founder Michael Truell responded quickly, stating OpenAI models accounted for only about five percent of Cursor’s AI traffic. The company is in talks with OpenAI’s team to find a solution. “Cursor was one of the very first users of OpenAI, we’ve worked closely with their team for years, and we’ve trusted their platform to be neutral infrastructure for our business,” Truell writes.
OpenAI knows how being cut off feels. In June 2025, Anthropic blocked the coding tool Windsurf from accessing its Claude models after reports surfaced that OpenAI wanted to acquire Windsurf. In August 2025, the tables turned on OpenAI when Anthropic revoked the company’s API access because OpenAI teams had apparently used Claude for internal benchmarks ahead of the GPT-5 launch.
What it means
Developers relying on Cursor for GPT integration face a potential loss of access to those specific models by late 2026 if the deal proceeds as planned. The situation highlights a growing tension where platform providers prioritise contractual compliance over long-standing partnerships, leaving users to manage their own API keys if the bridge between tools breaks.
