Tesla to Move Headquarters From California to Texas, Elon Musk Says

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The electric-vehicle maker has long been based in Silicon Valley

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“You go to our Fremont factory, it’s jam,” he said. “We’re like spam in a can.”

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Mr Musk said last year that he had moved to Texas, where his rocket company, Space Exploration Technologies Corp., or SpaceX, has major operations. He had previously compared California to a sports team that had become complacent after a winning streak. Tesla is following in the footsteps of companies including Hewlett Packard Enterprise Co.

A descendant of what Bill Hewlett and Dave Packard started in Palo Alto, Calif., Garage and Oracle Corporation

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, which previously moved its corporate headquarters to Texas in the wake of the COVID-19 pandemic.

Tech companies were among the first to send employees home at the start of the pandemic, and several major players in the industry have allowed their employees to work remotely permanently. That change has prompted many Silicon Valley employees and startup CEOs to move to other parts of the country for cheaper housing, less traffic and better living standards.

Mr. Musk nodded to some of those challenges, saying of the Bay Area, “It’s hard for people to buy a home, and a lot of people have to come from far away.”

Texas, especially its capital Austin, has attracted more technology companies and startup development in recent years, offering lower taxes and less regulation and more affordable real estate than California.

Lawmakers in Texas have vigorously encouraged offshore migration and provided financial incentives. Republican Governor Greg Abbott said in a television interview last month that he had spoken to Musk and that the Tesla chief executive was attracted to the state’s right-wing social policies. Mr Musk responded by saying that he prefers to stay out of politics.

Sarkar Abbott welcomes Tesla In a tweet on Thursday.

Austin is not without complications for Mr. Musk and others. In February, swaths of the state, including Austin, lost power in a temporary storm that Mr. Musk experienced firsthand. “I was actually in a house in Austin for that snow storm with no lights, no electricity, no heating, no internet — couldn’t even get to a food store,” he said.

Another problem: State law prohibits car companies from selling vehicles directly to consumers, as does Tesla’s business model.

Despite moving their headquarters from California, companies such as HPE have maintained a strategic center in the Bay Area, which remains the nation’s most important technology hub. Mr Musk said on Thursday that Tesla will maintain a significant presence in California and increase production from its Fremont, Calif., factory.

California Gov. Representative Gavin Newsom, a Democrat, did not immediately respond to a request for comment.

While Tesla trampled global supply chains to deliver a record number of vehicles in the third quarter, Mr. Musk indicated that parts shortages limited the company’s ability to deliver new, long-promised models. have make.

“This year has just been a constant struggle with the supply of parts,” he said.

Mr Musk said Tesla could begin production of its Cybertruck pickup late next year, with higher volume production expected in 2023. In January, he was optimistic that the company would start delivering some pickup trucks to customers by the end of 2021.

He said he expects the company to produce a new version of its long-delayed semitrailer truck and its Roadster sports car in 2023.

“We should be through our severe supply chain crunch in ’23,” he said.

Also on Thursday, an early vote tally indicated that Tesla director James Murdoch and Mr Musk’s brother, Kimbal Musk, would be re-elected to the company’s board, said investor-relations chief, Martin Vecha.

Proxy advisory firm Institutional Shareholder Services had urged investors to vote against his re-election over concerns including higher executive and director compensation. The directors have served on the board since 2017 and 2004 respectively. The Murdoch family is a major shareholder in News Corp., the parent company of Businesshala.

Initial tallies suggested that shareholders had signed a non-binding resolution to reduce the terms of board members from three to one year, and called for publishing additional information on Tesla’s diversity and inclusion efforts. .

The company said in a report late last year that people from underrepresented communities made up 60% of its US workforce, while women made up 21%.

Rebecca Elliot at [email protected] and Rob Copeland at [email protected]

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