At a shareholder meeting in October, Musk announced the move, and Tesla will move its headquarters from Palo Alto, California, to Austin, Texas. California is Tesla's birthplace, is also the country's largest new energy vehicle market, and Texas's policy friendliness to electric vehicles is far less than California, Tesla's reasons for moving its headquarters?
On Dec. 1, Tesla announced in a filing with the U.S. Securities and Exchange Commission (SEC) that the company had officially moved its headquarters from California to its Gigafactory in Austin, Texas. The 2,100-acre (8.5 million-square-meter) gigafactory, which is expected to be operational this year, will employ 5,000 people and plans to produce electric pickup trucks, the Cyberruck and Model Y, among other models.
Source: Tesla announcement
Until then, Tesla's headquarters had been in Palo Alto, California, and the famous Silicon Valley was located in a valley about 25 miles long between Palo Alto and San Jose. In addition to Tesla, there are also companies such as Dell, IDEO, HP and Palantir, and it is also home to Stanford University.
In fact, before Musk, many technology giants such as Oracle and HP have begun to move away from Silicon Valley, and the former mecca of technology entrepreneurship is gradually losing its former glory.
Austin, which is more than 2,000 kilometers away from Silicon Valley in a straight line, has begun to be favored by a number of technology giants, including Musk. With companies like Dell, Oracle, and LiveOps Cloud moving in, Austin has a "new Silicon Valley."
Why do Musks love Austin, the capital of Texas?
This is because: Austin, the "new Silicon Valley" in Texas, is a "real fragrance" for these tech giants, whether in terms of taxes or housing prices.
According to the data, in order to vigorously develop the economy, Texas has made great efforts in attracting investment in recent years. Not only has it adopted a "no income tax" policy (California, where Silicon Valley is located, has the highest income tax in the United States), but also introduced a number of preferential policies for enterprises setting up factories in Texas. Texas' abundant industrial resources such as oil, gas, wind and electricity also have great attraction for companies involved in manufacturing such as Tesla.
There are reports that leaving California and moving to Texas will save Musk billions of dollars in taxes. For Tesla employees, Texas' housing prices are cheaper than Silicon Valley's.
Although nearly 85 percent of Tesla's revenue comes from producing and selling electric cars, Musk expects Tesla from much more than just a car manufacturer. When he acquired solar energy company SolarCity, Musk had said that Tesla's mission has always been closely related to sustainable development.
Tesla will build two large energy storage battery systems in Texas, one near the Austin Gigafactory and the other near Houston.
Tesla has filed a petition to sell electricity to people in Texas, a move that would allow residents with photovoltaic panels in their homes to share electricity with the grid. In February this year, The extremely cold weather in Texas led to a large-scale power outage in the state, and the large-scale grid failure also allowed Musk to see the opportunity to develop energy storage in Texas.
In addition, Texas is also an important military and aerospace state in the United States, NASA's Johnson Space Center is located in Houston, Musk may not want to seize the opportunity of "near the water tower first to get the moon", paving the way for the development of SpaceX.
In the final analysis, the location of the enterprise is a comprehensive consideration, tax incentives, cost of living, commuting distance, government relations, personality of the decision-maker and many other factors are intertwined, as to how much weight each factor occupies in the final decision-making, it is not easy for the outside world to speculate.