Austin-based electric carmaker Tesla will open an engineering headquarters in California, more than a year after the company first announced plans to move its headquarters to Central Texas.
Tesla CEO Elon Musk announced the new engineering and artificial intelligence headquarters at a Wednesday event in the new office space, along with California Gov. Gavin Newsom. Approximately five minute event live-streamed on Twitter, and Newsom’s office confirmed the announcement.
Tesla too live-streamed more comments from Musk as the chief executive took the stage at a party for the new engineering headquarters.
“It’s going to be epic,” Musk said of the new location. “We will build the future here.”
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Why did Tesla move to California?
The company’s headquarters will remain in Austin, but Musk told CNBC that the new California facility is “effectively a Tesla headquarters,” and told the publication that Tesla is “kind of a company with two headquarters,” according to a CNBC report.
Thursday, the company also clarified in a tweet that the company’s headquarters will remain in Austin and the new engineering headquarters will be the main operation of Tesla engineering.
The company is taking space in Palo Alto that was previously occupied by Hewlett Packard Enterprise, which will move its headquarters to Houston in 2020. HPE is one of the oldest companies in Silicon Valley, tracing its roots back to 1938, which Musk nodded in his words.
“We are excited to announce that Tesla’s global engineering headquarters will be here, in the former headquarters of Hewlett Packard,” said Musk. “It’s been a poetic transition from the company (HPE) that founded Silicon Valley to Tesla. And we’re excited to make this our global engineering headquarters in California.”
Musk said Telsa “looks forward to an exciting partnership with California” and the world’s transition to sustainable energy as soon as possible.
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In the announcement, Newsom called the engineering headquarters “another proof point of the renewable energy vibrancy that is California” and said he “couldn’t be prouder of California’s commitment to support Tesla over the past few years.” decades.”
Newsom says that it is a point of pride that Tesla was born in California, and that the state is constantly developing and standing out from the rest of the world in engineering, AI and pushing the boundaries. He credits Musk with playing a big part in that success.
“I’m here because we don’t care about that,” Newsom said. “And we appreciate the investments you’re making here today.”
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What do we know about Tesla’s new engineering and AI headquarters?
The announcement of the engineering headquarters is consistent with Musk’s previous statements that Tesla will continue to expand in California. When the Austin headquarters was first announced, Musk said there was a limit to how much the company could scale in the San Francisco Bay Area, and cited the higher cost of housing there and long commutes for employees.
The company continues to operate and maintain regional offices and a factory in Fremont, California, outside of San Francisco. As of a January 2023 blog post, Tesla said it had grown to 47,000 employees in California.
As with the move of Tesla’s headquarters to Austin in late 2021, the announcement of the engineering headquarters has few details on what this could mean for the electric carmaker’s operations. But it heralds a possible patch in relations between Musk and California officials, which have become tense in recent years as Musk has increasingly criticized the state and publicly pushed back against California lawmakers. . He first threatened to move the company’s headquarters to Texas or Nevada in 2020.
Musk on Wednesday provided limited details about what the company will focus on in Palo Alto. In the evening’s remarks, which lasted about eight minutes, he said the company will build Optimus, the company’s humanoid robot, in the new location, as well as “truly develop a better future for to the people of Palo Alto.”
The CEO also commented on Tesla coming up on its 20th anniversary, and its continued growth in California Wednesday night at the party.
“It’s pretty wild to think what’s happened in two decades… Now we have millions of cars on the road, and we have a lot of models,” Musk said, referring to the predecessor of Tesla’s vehicles. .
He added, that since the start of Tesla, the car industry has gone from “no one making an EV” or believing in electric cars to an industry that now accepts electric cars as the future.
Musk also highlighted the company’s achievements in California, including its 48,000 employees in California, its status as the largest manufacturing player in the state, the number of locations, and the Fremont factory as its largest plant. in automotive in North America.
“Although we’re obviously expanding in many parts of the world, we’ve been expanding in California the whole time,” Musk said. “Each year, we have grown our headcount in California and we expect this to continue in the future.”
Musk also mentioned that the party will feature several models of the long-awaited Cybertruck, which is expected to be built in Austin and begin rolling out later this year.
How does this compare to Tesla’s headline announcement in Austin?
When Tesla officially announced a headquarters move to Austin in 2021, it would be one of the most high-profile economic development announcements in Austin history, but the first announcement, came with a bit of hype. either praise or warning, and the billionaire discussed the move almost casually while speaking to shareholders.
At the time, no details were given on where the headquarters would be located, how many employees it would have, or what departments it would include. The move also came as a surprise to many locals and state officials at the time.
As of December 2021, a company filing indicated that Tesla’s headquarters will be at the same address as several manufacturing facilities in the Austin area in southeast Travis County. It’s not yet clear whether the company, which continues to add millions of square feet of facilities in Central Texas, is building a separate headquarters building, how many employees will go to Central Texas, or how many jobs made to move.
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What are the future plans for the Tesla Gigafactory?
Dan Ives, an analyst at Wedbush Securities said the global engineering announcement is unlikely to have a major impact on Tesla’s operations in Central Texas.
“We don’t believe it will have a big impact on Austin as a hub for Tesla in the US,” Ives said. “Tesla’s roots are in California and it’s no wonder they’re being embraced at this key time of the EV revolution.”
The news comes as Tesla continues to add to its Austin facility, with plans to grow it by millions of square feet in the coming months. The company is rapidly building a $1.1 billion manufacturing facility, dubbed Giga Texas, which is expected to hire 10,000 people by the end of last year. In April, Tesla held a grand opening for the facility, and delivered its first cars, the Model Y SUV. The Austin-area facility is expected to play a key role in the company’s future, and will also manufacture the Cybertruck and Model 3 as well as vehicle batteries,
Ives added that while Palo Alto will remain an important center of operations for Tesla, he predicts that most of the spending and resources going forward will be related to Austin.
What is the Musk building in Texas?
The engineering announcement comes as Musk continues to make Texas and Austin a hub of activity for his various companies in recent years. The billionaire also announced in 2020 that he was also moving his residence to Texas, to be closer to Tesla’s Austin-area gigafactory and SpaceX’s facility in South Texas. Musk also moved the headquarters of his private foundation, the Musk Foundation, to Austin.
Musk has spent a significant amount of time in Austin since his move. In an 18-month period between December 2021 and August 2022, Musk, or at least his jet, spent 121 different days in Austin, more than any other place. But the billionaire seems to have been spending more time in California in recent months following his Twitter purchase.
The musk billionaire is also quietly expanding his other businesses in Central Texas, including moving his private foundation, moving the Boring Co. headquarters, which has facilities in Pflugerville and Bastrop. In Bastrop County, SpaceX is building an office, and Neuralink is building an office and lab space in the Del Valle area.