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Tesla To Move Headquarters To Texas From California

tesla oct08 lt

Tesla is moving its headquarters to Austin, Texas, from Palo Alto, California, according to its founder and CEO Elon Musk. The decision, revealed at the company's shareholder meeting, reflects size constraints and the cost of living in the Bay Area.

At the meeting, which took place at Tesla's vehicle assembly plant under construction in Austin, he further revealed plans to increase production in its California plant.

Musk said, "To be clear we will be continuing to expand our activities in California. Our intention is to increase output from Fremont and Giga Nevada by 50%. If you go to our Fremont factory it's jammed....It's tough for people to afford houses, and people have to come in from far away....There's a limit to how big you can scale in the Bay Area."

Talking about the Austin plant, Musk noted that it would take some time to reach full production even after the completion. According to him, Tesla takes less time to build a factory than to reach high-volume production.

The Palo Alto area has been Tesla's base since its founding in 2003. Last year, amid the severe spread of Coronavirus, Musk had lashed out at California government officials for forcing to temporarily close down Tesla's main factory. He called the state's Covid-19 lockdown measures "fascist", and also filed a law suit against Alameda County over the temporary shutdown.

Musk also threatened later to move the company's headquarters and future programs out of California and to Texas/Nevada.

In December last year, Musk, who is also CEO of aerospace company SpaceX, personally moved to Texas from California. His most prioritized projects are in Texas, including SpaceX's new Starship vehicle development facility and Tesla's new Gigafactory under construction in Austin.

Migration to Texas has some tax implications for him too, as the state levies no income or capital-gains tax while California's tax rates are among the highest in the nation.

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