Angle: “Produced in the Red States, Sold in the Blue States” Tesla Relocation Accelerates Twist | Reuters

[Austin (Texas, USA) 8th Reuters]— US electric vehicle (EV) giant Tesla announced on the 7th that it will move its headquarters in Palo Alto, California to Austin, Texas, and the EV industry will hire people in the south and west. The shift to the state is accelerating.

Electric vehicle (EV) giant Tesla announced on October 7 that it will relocate its headquarters in Palo Alto, California to Austin, Texas, accelerating the shift in employment to southern and western states in the EV industry. The photo shows the company’s CEO, Elon Musk. Taken in Austin, March 2013 (2021 Reuters / Gerry Shih)

In the south and west, there are many “red states” where Republican supporters predominate, tax burdens are generally light, regulations are loose, and the unionization rate is low. However, the main sales market for EVs in the country is the “blue state”, which is dominated by Democratic supporters, which is often found in coastal areas. For that reason, the relocation of Tesla’s headquarters will intensify competition between states for employment in the EV industry, and it will also have a political color.

In blue states such as California, there are many EV buyers and EV maker investors, who support strong climate change policies.

Meanwhile, many of the red states have acquired employment in the EV industry. Republican governors in these states are willing to accept EV makers and their jobs with the introduction of subsidies and deregulation, while supporting the fossil fuel industry.

Texas Governor Abbott also posted on Twitter, “Texas is a state of opportunity and innovation. Welcome,” following Tesla’s announcement on the 7th.

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In the EV industry, emerging and well-established manufacturers have already invested a total of $ 24 billion (about 2.68 trillion yen) on a planned basis for new plants in southern and western provinces such as Texas, Arizona, Oklahoma, Tennessee, and Kentucky. Has reached.

Tesla faces the challenge of retaining employees from a vibrant high-tech industry hub in the San Francisco Bay Area while at the same time leveraging Texas’ business environment. It should also be taken into account that there are many Tesla car customers in politically liberal states such as California and Newyork.

“Tesla is looking for a lot of incentives when California is in crisis, or abandoning it,” said John Boyd, a void company that helps companies choose their location. I don’t want to be criticized or attacked. “

California Governor Gavin Newsom (Democratic Party) praised Mr. Musk for investing in space companies SpaceX and other states to create jobs, while California has invested in Tesla for hundreds of millions of dollars. He also said it offers tax incentives for California, stressing that the state’s regulatory environment is driving entrepreneurship and subsequent growth.

Other US automakers, such as Ford Motor Company, have similar problems. Ford announced that it will invest 11 billion dollars with SK Innovation Co., Ltd. in South Korea to build a large-scale plant in Tennessee to manufacture EVs and batteries. The factory and related businesses in Kentucky are expected to create 11,000 jobs.

The United Auto Workers (UAW) immediately sought Ford to guarantee unionization of these jobs. However, union membership is voluntary in Tennessee and Kentucky, and employees of other automakers in these states have so far refused to work on organizing by the UAW.

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Musk’s confrontation with California surfaced when regulators urged Tesla to shut down production for months in the new coronavirus outbreak last year. He has a history of flickering the relocation of Tesla’s headquarters outside the state.

One of the richest people in the world, Musk moved to Texas last year and is completely integrated into the locals wearing Western-style bandanas and shirts. California imposes up to 13.3% tax on income, but Texas does not impose income tax on individuals.

Meanwhile, last year, California accounted for about 15% of Tesla’s worldwide deliveries.

Mr. Musk explained on the 7th that the relocation of the headquarters will not completely withdraw from California and will increase the production of Fremont’s assembly plant and the in-vehicle battery plant in Nevada by 50%. Technicians will remain in Silicon Valley, and some treasury officials are likely to relocate, according to people familiar with the matter.

Texas law prohibits Tesla from selling cars directly to customers in the state, which could be a thorny issue.

Austin, the capital of Texas, has the fastest growing metropolitan area in the country, with a 30% increase in population to about 2.3 million in 2010-20. Austin, where Tesla’s factories are located, and the surrounding area, like other large cities in Texas, set itself apart from the majority of other democratic, conservative, and less populated states.

The Austin metropolitan area is a high-tech center and is home to major players such as Dell Technologies.

Austin is known for its unusual culture. It is also the venue for large-scale music festivals such as Austin City Limits and South by Southwest, and attracts a large audience every year.

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However, the rapid growth and the influx of high-income Californians have led to a backlash from some locals. Many citizens are frustrated by reports that out-of-state buyers bought their homes in cash at twice the asking price.

(Tina Bellon reporter, Hyunjoo Jin reporter)


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