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Tesla moving headquarters to Texas from California

Stock MarketsOct 08, 2021 08:15PM ET
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2/2 © Reuters. FILE PHOTO: Tesla Inc CEO Elon Musk walks next to a screen showing an image of Tesla Model 3 car during an opening ceremony for Tesla China-made Model Y program in Shanghai, China January 7, 2020. REUTERS/Aly Song/File Photo 2/2

(In story from Thursday, clarifies in second paragraph that company is Hewlett Packard Enterprise (NYSE:HPE))

By Hyunjoo Jin and Subrat Patnaik

SAN FRANCISCO (Reuters) -Tesla Inc Chief Executive Elon Musk said on Thursday the electric carmaker plans to move its headquarters from Silicon Valley's Palo Alto, California to Austin, Texas, where it is building a massive car and battery manufacturing complex.

Tesla (NASDAQ:TSLA) joins Oracle (NYSE:ORCL), Hewlett Packard Enterprise and Toyota Motor (NYSE:TM) in moving U.S. headquarters to Texas from California, which has relatively high taxes and living costs. While Silicon Valley also is a hive of development of new ideas and companies, Texas is known for cheaper labor and less stringent regulation.

"I'm excited to announce that we're moving our headquarters to Austin, Texas," Musk told the company's annual meeting, held in the Texas car factory.

"This is not a matter of, sort of, Tesla leaving California," he said, saying it plans to increase output from its main California factory and Nevada factory by 50%.

The Fremont, California factory nonetheless is "jammed" and it is tough for people to afford houses in California, he said.

Billionaire Musk himself moved to the Lone Star State from California in December to focus on the electric-car maker’s new plant in the state and his SpaceX rocket company, which has a launch site in the southern tip of Texas.

Musk had a rocky relationship at times with California, threatening to move Tesla headquarters and future programs to Texas during a row over the closure of Tesla’s factory in Fremont, California due to COVID-19, for instance.

At the meeting he showed off a design of what looked like a cowboy-style belt buckle emblazoned with "Don't Mess With T" -- the T in the style of the Tesla logo. The phrase is based on a venerable and popular Texas anti-littering campaign - Don't Mess with Texas.

DIRECTOR TERM CUT

Despite some criticism from activist shareholders and a proxy advisory service, shareholders followed board guidance on several key proposals, including reelection of Kimball Musk, Elon's brother, and James Murdoch as board directors.

But they voted in favour of a stockholder proposal to reduce director terms from three years to one year and a proposal regarding additional reporting on diversity and inclusion efforts.

"It's unfortunate that the shareholders did not agree to remove Murdoch and Musk's brother. But I think they know the pressure is on them," Stephen Diamond, a professor at Santa Clara University School of Law, said.

"They've got a lot more work to do on governance. Just changing the term is just an artifact of a larger governance issue," William Klepper, a professor at Columbia Business School, said.

Advisory firm Institutional Shareholder Services (ISS) had recommended that Tesla investors not re-elect the two directors because of concerns about excessive compensation packages to non-executive board members.

Shareholders also voted against a stockholder proposal asking for a study into the impact of Tesla's use of arbitration on workplace harassment and discrimination.

The proposal, opposed by the board, was thrown into the spotlight after a Black former contract worker on Monday won a $137 million jury award against Tesla over workplace racism.

Tesla moving headquarters to Texas from California
 

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Comments (13)
Patrick Callahan
Patrick Callahan Oct 08, 2021 11:42PM ET
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California *****
Mark Stallone
Mark Stallone Oct 08, 2021 10:15PM ET
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Gee I didn't see that coming.. Said no one with 1/2 a brain. His factories are next. Good job, Cali. Good job
Dominic Max
Dominic Max Oct 08, 2021 10:15PM ET
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8 te i t7yy
Light Bringer
Light Bringer Oct 08, 2021 9:51PM ET
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lmao musk gonna turn evil in Texas.
palmer gossett
palmer gossett Oct 08, 2021 8:46PM ET
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Please stay away
Mark Stallone
Mark Stallone Oct 08, 2021 8:46PM ET
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No problem.
Mike Mike
Mike Mike Oct 08, 2021 1:57AM ET
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Roach is moving to south
EHDDyce FC
EHDDyce FC Oct 07, 2021 9:44PM ET
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California retains 60% of the jobs post move via remote. Texas tax payers will cover some of the costs via tax breaks. Decent win-win for the liberal Austin and LA.  California retains most headquarters jobs, and gains 50% production. Texas gains some office jobs in a downsized headquarters. Mass majority are expected to relocate for this job.  Decent move for Tesla to take advantage of Americas new slave labor in the south for new Texas hires.
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Trevor Roberts
LimitUp Oct 07, 2021 9:44PM ET
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You guys are thick, it costs a fortune to survive in Cal. You have to look real wage gain in relation to your expenses. Someone could move to TX, make less top line and at the end of the year be way ahead.
Trevor Roberts
LimitUp Oct 07, 2021 9:44PM ET
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Its funny wstching dems try spin a sorry state with bad policies into something worth while.
EHDDyce FC
EHDDyce FC Oct 07, 2021 9:44PM ET
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Trevor Roberts  The cost of living in Austin is roughly the same. While income is lower.
Mark Stallone
Mark Stallone Oct 07, 2021 9:44PM ET
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EHDDyce FC State tax difference is huge.
Mark Stallone
Mark Stallone Oct 07, 2021 9:44PM ET
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EHDDyce FC His factories are next.
Felipe Daniel
Felipe Daniel Oct 07, 2021 7:46PM ET
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Democrats destroy economies, tell me im lying
Brandon Olds
Brandon Olds Oct 07, 2021 7:46PM ET
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that is why tesla is leaving pathetic California for Texas!
EHDDyce FC
EHDDyce FC Oct 07, 2021 7:46PM ET
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Brandon Olds  production still in california, they are just moving "headquarters" to save on taxes for executives.
EHDDyce FC
EHDDyce FC Oct 07, 2021 7:46PM ET
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Most of the GDP is in blue states.
Co Gonz
Co Gonz Oct 07, 2021 7:46PM ET
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you're not looking at gdp growth.. big difference. further gdp differs by state because each state is diverse- nyc only because finance- finance CEO of top 5 banks are Republicans though- weird right. Texas gdp growth went down as administration tries to move away from oil- that's why the state said they won't enforce anything the federal government says- further these states and major cities are becoming unbearable- goodluck from UK
Chris Sundo
Chris Sundo Oct 07, 2021 7:43PM ET
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Good riddance of Musk getting kicked out of California. I dumped Musk's TSLA after he chummed up to Putin a while back and complimented him with 'It is an honor ...' . --- Musk also misbehaved on human rights issues during the mandatory mask-wearing time. Musk is an unsuitable ego man.iac, like Trump, to support a mature society. Let him go to Texas where the roughneck cowboys and other Trump cult members do their ill will.
lance Lalonde
lance Lalonde Oct 07, 2021 7:43PM ET
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You can't be serious
Brandon Olds
Brandon Olds Oct 07, 2021 7:43PM ET
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Musk kicked out? haha he is leaving the dump of California and Cali will now lose $$ millions... always the same w pathetic Liberal States
Brandon Olds
Brandon Olds Oct 07, 2021 7:43PM ET
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But hey instead of Trump we got Mr Dementia Biden w 36% approval and destroys everything he touched haha
Harry Bedford
Harry Bedford Oct 07, 2021 7:43PM ET
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California is a dumpster 🔥
Trevor Roberts
LimitUp Oct 07, 2021 7:43PM ET
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Its hilarious when Dems try to act like Republicans are the one getting cozy with Communists. Ever hear of a communist named Bernie? Socialism is the gateway drug to communism.
CHARLIE HAYDEN
CHARLIE HAYDEN Oct 07, 2021 7:42PM ET
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Better bring your own electricity. Abbott dont care about blackouts.
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Brandon Olds
Brandon Olds Oct 07, 2021 7:42PM ET
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It is 'doesn't care' not 'don't care' and the blackouts our due to the left liberal green Liara who made Texas use Wind Power Mills and the wind isn't constant. check your facts u bad English speaker
Trevor Roberts
LimitUp Oct 07, 2021 7:42PM ET
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Ask Nancy to visit Texas in the winter, she is good at blowing hard.
patrick thrower
patrick thrower Oct 07, 2021 7:42PM ET
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don't forget the coat hangers too
EHDDyce FC
EHDDyce FC Oct 07, 2021 7:42PM ET
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lance Lalonde  Texas has lead in the last 10 years of households effected by 30% while having half of the population.
John Laurens
John Laurens Oct 07, 2021 7:42PM ET
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🤣🤣🤣🤣🤣🤣🤣🤣🤣California complaining about blackouts in Texas... Did that come straight from Jen Psaki? The hypocrisy on the left gets thicker by the day..
Md All Bakir Islam
Md All Bakir Islam Oct 07, 2021 7:28PM ET
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very nich
BigPoppa Jcamp
BigPoppa Jcamp Oct 07, 2021 7:27PM ET
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Don't bring the California voting habits with you or you will need to move again.
John Laurens
John Laurens Oct 07, 2021 7:06PM ET
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Smart man leaving that steaming pile of a state!
EHDDyce FC
EHDDyce FC Oct 07, 2021 7:06PM ET
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60% of the headquarter jobs will be remote and they will stay in california. Along with more jobs being added to california production.
John Laurens
John Laurens Oct 07, 2021 7:06PM ET
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EHDDyce FC  Still an embarrassing steaming pile of a state..
William Bailey
William Bailey Oct 07, 2021 6:49PM ET
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Good riddence !
Small Trader
Small Trader Oct 07, 2021 6:49PM ET
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to California!
patrick murphy
patrick murphy Oct 07, 2021 6:49PM ET
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good riddance to California
EHDDyce FC
EHDDyce FC Oct 07, 2021 6:49PM ET
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patrick murphy  60% of the jobs are remote staying in california. California benefits the most while texas bares the cost.
 
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