Elon Musk confirmed Thursday that Tesla will be moving its headquarters from Palo Alto, California, to Austin, Texas, taking advantage of the state’s lack of personal income tax and following through on a promise he first made over a year ago in response to the Golden State’s strict coronavirus guidelines.
‘I’m excited to announce that we’re moving our headquarters to Austin, Texas,’ the tech billionaire announced to cheers and applause during the company’s shareholder meeting at its vehicle assembly plant in Austin, which is under construction and borders the Colorado River.
‘Just to be clear though, we will be continuing to expand our activities in California, so this is not a matter of Tesla leaving California,’ he noted, adding that the company plans on increasing output in California and Nevada by 50 percent.
Musk said that Tesla, which has been in Silicon Valley since 2003, has outgrown its Fremont factory.
‘It’s like we’re spam in a can here,’ he said, adding that there’s sparse affordable housing and a lot of workers have a long commute.
Elon Musk confirmed Thursday that Tesla will be moving its headquarters from Palo Alto, California, to Austin, Texas. He made the announcement above at a meeting of the company's shareholders on Thursday
The company's vehicle assembly plant in Austin (pictured above) is under construction and borders the Colorado River
But in Texas, he said, ‘Our factory’s like five minutes from the airport, 15 minutes from downtown and we’re gonna create ecological paradise right here.’
While he did not give a timeline of when Tesla’s headquarters in Texas will be operational, he noted that it takes less time to build a factory than it does to reach high-volume production.
He said that the plant in Texas will closely resemble Tesla’s Shanghai plant, which was built in 11 months and reached high-volume production after a year.
In December, Musk personally moved to Texas after living in California for two decades. Moving to Texas allowed Musk to get closer to his aerospace company SpaceX’s launch site in Boca Chica and reduce his personal tax burden.
California has some of the highest personal income taxes in the country on its wealthy residents, but Texas has no personal income tax.
Musk said that said California is not as affordable and his workers have a long commute. Above is Tesla's primary vehicle factory in Fremont, California
Musk first publicly mentioned his plan to leave California for Texas in a string of furious tweets in May 2020 after a California county health official said that the plant could not reopen amid coronavirus shutdowns.
The disgruntled CEO took to a comment thread on Twitter to share that he was also planning to file a lawsuit against Alameda County.
Musk's fury was directed towards Alameda County Health Officer Erica Pan, who said the Fremont company would not be able to reopen despite California Governor Gavin Newsom lifting some coronavirus restrictions at the time.
'Frankly, this is the final straw. Tesla will now move its HQ and future programs to Texas/Nevada immediately,' he said in tweet on May 9, 2020.
'If we even retain Fremont manufacturing activity at all, it will be dependent on how Tesla is treated in the future. Tesla is the last carmaker left in CA.'
Musk first teased the move to Texas in the beginning of the coronavirus pandemic in response to California's strict reopening guidelines. The disgruntled CEO took to a comment thread on Twitter about his opposition to the state's reopening rules
In a separate tweet, he threatened to sue Alameda County over the restrictions
In a separate tweet, he wrote, 'Tesla is filing a lawsuit against Alameda County immediately. The unelected & ignorant “Interim Health Officer” of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!'
The dispute came a week after Musk lambasted state officials over lockdown orders he called 'fascist' and unconstitutional.
Tesla’s move to Texas from California follows that of other tech giants like Oracle and Hewlett Packard. Texas has been reeling in companies by offering tax breaks for those that put new facilities in the state through the Texas Economic Development Act.
Texas Gov. Greg Abbott lauded Musk’s plans to move Tesla to Texas last month and said in an CNBC interview that the two talk frequently and that Musk supports his state’s ‘social policies.’
His statement came a day after Texas introduced its strict abortion law that bans pregnancy terminations after a fetal heartbeat is detected within six weeks. A federal judge has since ordered a temporary injunction of the toughest-in-the-nation abortion ban.
Musk shied away from disclosing his views on the subject.
'In general, I believe government should rarely impose its will upon the people, and, when doing so, should aspire to maximize their cumulative happiness. That said, I would prefer to stay out of politics,’ he said.
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