News

Tesla to move headquarters from Palo Alto to Austin

CEO cites high housing costs, long commutes and limitations in growth

Elon Musk, CEO of Tesla, addresses shareholders in an annual meeting held on Oct. 7, 2021, in Austin, Texas, and broadcast over Zoom. Zoom screenshot courtesy Tesla.

UPDATE: On Oct. 8, the Registry real-estate news site reported that Tesla has agreed to lease 325,000 square feet of a site that formerly housed HP's headquarters, at 1501 Page Mill Road, in Palo Alto. This space will not be used as Tesla's HQ, however.

Tesla Inc., the electric vehicle and energy storage company, is moving its Palo Alto-based headquarters to Austin, Texas, the company's CEO Elon Musk said Thursday afternoon.

The announcement came during an annual shareholder meeting hosted from inside one of Tesla's Gigafactories also located in Austin.

Musk gave vague explanations for the move, but cited high housing costs and long commute for workers as well as growth limitations imposed by being in the Bay Area.

"It's tough for people to afford houses and a lot of people have to come in from far away. … There's a limit to how big you can scale in the Bay Area," he said.

What's local journalism worth to you?

Support Almanac Online for as little as $5/month.

Join

But this is not the end for Tesla's story in California. Musk added that the company will "increase output" from its Fremont and Nevada factories by 50%.

"This is not a matter of Tesla sort of leaving California," he said.

Tesla will be moving its headquarters from Palo Alto to Texas, CEO Elon Musk announced on Oct. 7, 2021. Photo by Steve Jurvetson obtained via Wikimedia Commons under Creative Commons Attribution 2.0 Generic license.

Propping up the benefits of the new location, Musk said the new headquarters will be five minutes from the airport and 15 minutes from downtown. And while the company will continue to grow in California, Tesla will expand "even more so" in Texas.

Tesla, a company that has grown exponentially since it was founded in 2003 and set the standard for electric vehicles, first arrived to Palo Alto in 2009, moving from San Carlos into a 350,000-square-foot building in Stanford Research Park.

The company's former chief technical officer and co-founder J.B. Straubel said one large incentive to come to Palo Alto was the city's proximity to Stanford University. (Straubel is also a Stanford alumnus.)

But recently, Musk became an increasingly vocal critic against the golden state and Silicon Valley. In an interview during The Wall Street Journal's annual CEO Council summit, the Tesla CEO revealed that he moved out of California as it had become "complacent" in its leading economic status. He also suggested that Silicon Valley had become increasingly irrelevant.

"I think we’ll see some reduction in the influence of Silicon Valley,” he said in the interview.

Stay informed

Get daily headlines sent straight to your inbox in our Express newsletter.

Stay informed

Get daily headlines sent straight to your inbox in our Express newsletter.

Follow AlmanacNews.com and The Almanac on Twitter @almanacnews, Facebook and on Instagram @almanacnews for breaking news, local events, photos, videos and more.

Tesla to move headquarters from Palo Alto to Austin

CEO cites high housing costs, long commutes and limitations in growth

by / Palo Alto Weekly

Uploaded: Thu, Oct 7, 2021, 5:45 pm

UPDATE: On Oct. 8, the Registry real-estate news site reported that Tesla has agreed to lease 325,000 square feet of a site that formerly housed HP's headquarters, at 1501 Page Mill Road, in Palo Alto. This space will not be used as Tesla's HQ, however.

Tesla Inc., the electric vehicle and energy storage company, is moving its Palo Alto-based headquarters to Austin, Texas, the company's CEO Elon Musk said Thursday afternoon.

The announcement came during an annual shareholder meeting hosted from inside one of Tesla's Gigafactories also located in Austin.

Musk gave vague explanations for the move, but cited high housing costs and long commute for workers as well as growth limitations imposed by being in the Bay Area.

"It's tough for people to afford houses and a lot of people have to come in from far away. … There's a limit to how big you can scale in the Bay Area," he said.

But this is not the end for Tesla's story in California. Musk added that the company will "increase output" from its Fremont and Nevada factories by 50%.

"This is not a matter of Tesla sort of leaving California," he said.

Propping up the benefits of the new location, Musk said the new headquarters will be five minutes from the airport and 15 minutes from downtown. And while the company will continue to grow in California, Tesla will expand "even more so" in Texas.

Tesla, a company that has grown exponentially since it was founded in 2003 and set the standard for electric vehicles, first arrived to Palo Alto in 2009, moving from San Carlos into a 350,000-square-foot building in Stanford Research Park.

The company's former chief technical officer and co-founder J.B. Straubel said one large incentive to come to Palo Alto was the city's proximity to Stanford University. (Straubel is also a Stanford alumnus.)

But recently, Musk became an increasingly vocal critic against the golden state and Silicon Valley. In an interview during The Wall Street Journal's annual CEO Council summit, the Tesla CEO revealed that he moved out of California as it had become "complacent" in its leading economic status. He also suggested that Silicon Valley had become increasingly irrelevant.

"I think we’ll see some reduction in the influence of Silicon Valley,” he said in the interview.

Comments

Joseph E. Davis
Registered user
Woodside: Emerald Hills
on Oct 8, 2021 at 10:54 am
Joseph E. Davis, Woodside: Emerald Hills
Registered user
on Oct 8, 2021 at 10:54 am

[Post removed due to disrespectful comment or offensive language]


new guy
Registered user
Menlo Park: Downtown
on Oct 8, 2021 at 1:05 pm
new guy, Menlo Park: Downtown
Registered user
on Oct 8, 2021 at 1:05 pm

Maybe, Tesla should have been invited to DC during the EV summit, but I guess he doesn't "contribute enough" = buy enough politicians off like most legacy automakers.

Best part, is she then tweeted, that Musk was a "snowflake". Not sure what point she is trying to make here.

Keep voting for these people that hate those who become successful.


Kevin
Registered user
Menlo Park: South of Seminary/Vintage Oaks
on Oct 8, 2021 at 2:42 pm
Kevin, Menlo Park: South of Seminary/Vintage Oaks
Registered user
on Oct 8, 2021 at 2:42 pm

I’m hoping Musk continues his string of successes from the Austin HQ. We certainly want him to figure out how to make it legal for people to buy cars from Tesla dealerships in Texas, so we can sell more California-made cars there ! Illegal right now.

Tesla won't be able to directly sell the cars it builds in Texas to Texans
Web Link


Kevin
Registered user
Menlo Park: South of Seminary/Vintage Oaks
on Oct 8, 2021 at 3:32 pm
Kevin, Menlo Park: South of Seminary/Vintage Oaks
Registered user
on Oct 8, 2021 at 3:32 pm

Interesting, Tesla is also expanding its footprint in Palo Alto.

Tesla agrees to big office lease in Palo Alto, despite HQ exit
Tesla plans to take office space in Stanford Research Park

Web Link


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Post a comment

In order to encourage respectful and thoughtful discussion, commenting on stories is available to those who are registered users. If you are already a registered user and the commenting form is not below, you need to log in. If you are not registered, you can do so here.

Please make sure your comments are truthful, on-topic and do not disrespect another poster. Don't be snarky or belittling. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

See our announcement about requiring registration for commenting.