Elon Musk chooses California for Tesla’s Global Engineering Headquarters

Tesla Inc.

TSLA 1.77%

said it established its global tech headquarters in Palo Alto,

California, a state Chief Executive Elon Musk has criticized at times.

Mr. Musk moved Tesla headquarters from Silicon Valley to Texas in 2021, saying at the time that the company’s ability to scale in the San Francisco Bay Area was limited. He had previously likened California to a sports team resting on its laurels after a winning streak, saying, “They tend to get a little bit complacent, a little bit entitled, and then they don’t win the championship anymore.”

Mr Musk struck a more upbeat tone on Wednesday evening, saying at an event in Palo Alto that the company would “build the future here”.

California Governor Gavin Newsom and Tesla CEO Elon Musk on Wednesday announced the location of the company’s new global technical headquarters. The facility will be located in the former building of computer maker Hewlett Packard in Palo Alto. Photo: Tesla

Tesla has maintained a presence in Silicon Valley even after moving its headquarters to Texas and it employs about 48,000 people in California, Mr. Musk said. That amounts to more than a third of the company’s global workforce at the end of the year.

Many of those employees work across the bay from San Francisco in Fremont, California, home of the company’s first car manufacturing plant. That facility has the capacity to make about 650,000 vehicles per year, Tesla said.

The company has since opened car factories in China, Texas and Germany.

On Wednesday, Mr. Musk said Tesla would continue to invest in California even as it expands elsewhere.

Tesla has had layoffs in California over the past year. Last year, Tesla laid off more than 200 people when it closed an office in San Mateo, California. The location was home to staffers who worked on Tesla’s advanced driver assistance system known as Autopilot.

The car company, led by Mr. Musk, is in expansion mode to reach its goal of selling 20 million vehicles a year by the end of the decade. In January, Tesla announced it was considering more than $775 million in expansions to its Austin-area plant.

Tesla cars at the Fremont, California factory in 2022.


Photo:

Justin Sullivan/Getty Images

Other companies led by Mr. Musk also have a large presence in California. Twitter Inc. is based in San Francisco and rocket company SpaceX is based in Hawthorne.

Write to Joseph De Avila at joseph.deavila@wsj.com and Rebecca Elliott at rebecca.elliott@wsj.com

Corrections and reinforcements
Elon Musk said the decision to locate Tesla’s global tech headquarters in California was a “poetic transition from the company that founded Silicon Valley to Tesla.” In an earlier version of this article, he was incorrectly quoted as ‘poetic translation’. (Corrected February 22)

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Appeared in the February 23, 2023 print edition as “Tesla Sets Palo Alto Engineering Hub.”

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