A man is seen driving his Tesla car behind SpaceX’s Starship SN8, just days before the test launch of the company’s new super-heavy-lift Starship rocket from their facility in the small town of Boca Chita, Texas.
Jean Blevins | Reuters
Tesla is moving its headquarters to Palo Alto, Austin, California, Texas, CEO Elon Musk announced at the company’s shareholder meeting on Thursday.
The meeting took place at the Tesla Vehicle Assemblies under construction outside Austin, at a property on the Colorado River border near the city airport.
However, the company plans to increase production at its California plant, regardless of its headquarters location.
“Clearly we will continue to expand our activities in California,” Musk said. “Our goal is to increase production from Fremont and Giga Nevada by 50%
But, he added, “It’s hard for people to carry a house, and people have to come from far away …. There’s a limit to how big you can fit in the Bay Area.”
Regarding the plant running in Austin, he mentioned that it would take some time to reach full production even after it was completed.
“It takes longer to build a factory on Tesla-land than it does to get a higher volume of production after the factory is built,” Musk said. The Tesla Shanghai plant, for example, was built in 11 months, but took a year to reach high volume production. He hopes Tesla’s new plant to Austin will follow Shanghai’s example.
The growing dissatisfaction with every mask in California has been evident for some time. In April 2020, at the urging of Tesla Income, Musk called their temporary covid-related health orders against California government officials “fascist.”
Later, Musk personally moved from Los Angeles to the Austin area, where he lived for two decades.
As a result, Musk, the CEO of space agency SpaceX, has been able to reduce his personal tax burden and stay close to the SpaceX launch site in Texas.
The Tesla board provides Mask with an executive compensation package that could lead him to a comprehensive stock award based on the automaker’s market cap increase and some other financial targets. According to InsiderScore, he could earn more than 20 20 billion this year if he sells options that expire in 2021.
California imposes some of the highest personal income taxes in the country on its wealthy residents, but Texas does not.
Tesla is not the first company headquartered in Texas from California. Oracle and Hewlett-Packard are among the technology giants that decided to take this step last year, for example.
Texas is actively hiring companies through its Texas Economic Development Act to provide tax breaks to provide new benefits to the state. Cultural events like Austin, a top technology university, and South by Southwest, are an attraction for technology employers.
Attorney Dominic Romano, a business partner managing Romano law in New York City, explained that taking such action is not particularly burdensome. A Delaware business, which serves as a “foreign” corporation headquartered in California, as Tesla has, set up a facility in the new state, relocating its residence there by hiring. And transferring key staff.
They do not have to stop operations in other states, although they usually return them.
“From a legal standpoint, a regulatory burden in Texas is low,” Romano said. “It’s a more business- and in many ways an employer-friendly state. In terms of reporting requirements and more, you’ll have to jump through much fewer hoops in Texas or Florida as an employer than in California.”
Texas Gov. Greg Abbott said the Tesla CEO supported his state’s “social policies.” However, Elon Musk refused to weigh in on Texas-restricted new abortion laws, after Abbott made that claim.
“In general, I believe that the government should seldom impose its will on the people, and when it is done, they should aspire to be the happiest,” Musk wrote on Twitter at the time. “That said, I’d love to stay out of politics,” Musk said.
Since its inception in 2003, Tesla has received a lot of support from the state of California. It has enjoyed grant funding, tax breaks, incentives, and favorable policies from the California Air Resource Board, the California Energy Commission, and the choice of California. Alternative energy and advanced transport financing authorities among others.