Tesla Headquarters To Set up Shop Back in California. Sorry, Texas

Tesla Engineering Headquarters HQ2 California Article Highlights:

  • CEO Elon Musk and EV producer Tesla will set up its engineering headquarters in Palo Alto, California. 
  • The new “HQ2” facility will occupy the former Hewlett Packard building and focus on research development and artificial intelligence.
  • The company’s corporate HQ will remain in Austin, Texas.  

Despite Tesla’s sizable additions to the Austin area, the electric vehicle super name will set up shop in California. Elon Musk says the new Tesla engineering headquarters will return the big ‘T’ to Palo Alto. So, why would Tesla set up part of its EV operation in a tax-heavy state like California instead of the Lone Star State?  

CEO Elon Musk makes a gesture at a Tesla in either California HQ2 or the Texas HQ.
Elon Musk | Frederic J. Brown, AFP via Getty Images

Is Tesla HQ moving back to California?

Tesla’s corporate headquarters moved to Austin, Texas, in 2021. Furthermore, the electric vehicle company will remain in the Lone Star State. However, CEO Elon Musk and California Governor Gavin Newsom recently announced that Tesla’s engineering headquarters, HQ2, will move to Palo Alto, California. 

According to Reuters, Newsom pointed his cheeky commentary at Germany rather than Texas. “Eat your heart out, Germany,” Newsom joked. Moreover, the facility will set up shop in a former Hewlett Packard structure. Reuters said Elon Musk delivered nostalgic comments on the move into the legacy tech company’s old facility. “This is a poetic transition from the company that founded Silicon Valley to Tesla,” Musk commented to the media. 

Additionally, the new facility will focus on artificial intelligence and research development rather than corporate strategy and leadership. 

Is Tesla leaving Texas?

Although Tesla is creating another presence in Palo Alto, the automaker isn’t abandoning its interests in Texas. Not only will the Tesla corporate headquarters remain in Texas, but CEO Elon Musk also moved to Austin a few years ago.

Musk’s move stemmed from his feelings on California’s taxation landscape, claiming it was a situation of “overregulation, overlitigation, [and] overtaxation.” As Texas doesn’t collect any income tax, it’s a popular destination for California ex-pats who want to avoid it. 

Why would Tesla’s engineering headquarters move to California? 

Tesla already has its Fremont, California location, which produces over 600,000 EVs per year. It’s not a wild move, then, that the automaker would reinforce its California presence while maintaining its Texas interests. 

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What Is a Tesla-Stan?

Reuters asked an analyst at Morningstar, Seth Goldstein, why the EV maker would make the move with HQ2. “Given that the Bay Area in California is home to many leading tech companies, it makes sense for Tesla’s engineering headquarters to be located there as a way to attract top talent,” Goldstein said. 

Does Tesla have a factory in Texas?

In addition to its corporate headquarters, Tesla operates Giga Texas, a 2,500-acre facility with over 10 million square feet of factory floor space. The automaker says the facility is the U.S. hub for the Model Y. Moreover, the controversial Cybertruck will call Giga Texas home. 

As a result, it’s doubtful that the electric vehicle producer would shift its entire operation away from Texas.  

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