Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Tesla’s headquarters will move to Austin

kxan.com

Post reply on HN
Print view View original

171–180 of 691 posts

Re: Tesla’s headquarters will move to Austin

#171

Post by BurningFrog »

m0zg wrote: post #139
Apocryphon wrote: post #56

The official reason is because of housing: "To be clear we will be continuing to expand our activities in California," Musk said. "Our intention is to increase output from Fremont and Giga Nevada by 50%. If you go to our Fremont factory it's jammed." But, he added, "It's tough for people to afford houses, and people have to come in from far away....There's a limit to how big you can scale in the Bay Area." https://ww…

I've looked at properties in Austin area a few months back. It's more affordable than CA, but it's still way out of reach of most non-HQ staff that Tesla employs. I've read the stat that property values have gone up 43% due to exodus from locked down blue states over the course of just the past year. Couple this with Texas' higher than average property tax rate (_especially_ in Austin area) and you've got some pretty…

One theory is that it's still legal to build new housing in Texas, so the Austin supply can increase to match the demand.

Re: Tesla’s headquarters will move to Austin

#172

Post by narrator »

cjensen wrote: post #76

When CEOs move, they often move their headquarters closer to where they live. Somehow Tesla managed to survive all the problems of California until shortly after Musk moved to Texas. Folks talking about the advantages and disadvantages of California vs Texas may be overthinking this.

The talk about wealth taxes was probably one of the reasons he decided to move. You want to get all the billionaires to move out of your state, just bring up wealth taxes.

Re: Tesla’s headquarters will move to Austin

#173

Post by jeffbee »

bsagdiyev wrote: post #92
jeffbee wrote: post #59

Earlier quoted context omitted.

Right. People don’t get this because tax policy is dominated by right-wing memes but tax load for median families is way higher in Texas. Property tax rates on the median house are higher, while the effective income tax on the median income in California is very little. Median income tax burden in California is ~$350/yr.

That seems way off… when I earned $16/hr way back in my early working days my CA state income tax was a hell of a lot more than $350/yr. $16/hr is under the median CA income afaik.

If you filed married for example your 2020 tax burden on a gross income of 32000 ($16 * 2000 hours) would have been $272.

Re: Tesla’s headquarters will move to Austin

#174

Post by chris11 »

asdff wrote: post #159
etchalon wrote: post #141

Earlier quoted context omitted.

As someone who just bought a house in Austin this year, if the reason is "affordable housing", they're in for a world of hurt.

Property taxes are higher than California, right? I can't find the source handy at the moment, but I've heard that a house in Austin that looks like a couple hundred grand cheaper than an equivalent house in California for the listing isn't actually any cheaper when you factor in the increased taxes and potentially other costs I'm not aware of.

That's my question. Taxes are higher and CA has prop 13, so the difference gets worse.

Re: Tesla’s headquarters will move to Austin

#175

Post by Mountain_Skies »

gfitz wrote: post #110
Apocryphon wrote: post #56

The official reason is because of housing: "To be clear we will be continuing to expand our activities in California," Musk said. "Our intention is to increase output from Fremont and Giga Nevada by 50%. If you go to our Fremont factory it's jammed." But, he added, "It's tough for people to afford houses, and people have to come in from far away....There's a limit to how big you can scale in the Bay Area." https://ww…

I don’t think housing would be the “official” reason as Elon is keenly aware of how hard it is to buy a house in central Texas right now. Source: https://www.businessinsider.com/elon-musk-austin-texas-housi...

That's temporary and the company has to look at things long term. Austin doesn't have the geographical barriers that the Bay Area has. If the building supplies and labor are available, Austin can sprawl out in pretty much any direction, though obviously transportation eventually becomes an issue.

Re: Tesla’s headquarters will move to Austin

#176

Post by random314 »

darawk wrote: post #146
cjensen wrote: post #76

When CEOs move, they often move their headquarters closer to where they live. Somehow Tesla managed to survive all the problems of California until shortly after Musk moved to Texas. Folks talking about the advantages and disadvantages of California vs Texas may be overthinking this.

I mean, you could just as easily argue that the problems of California are what caused his move to Texas, as simply testing the waters for the move of the HQ.

Musk had billions of dollars in performance based stocks vesting over these years.

The simplest reason for moving is avoiding billions of dollars in California state income taxes.

Re: Tesla’s headquarters will move to Austin

#177

Post by iab »

etchalon wrote: post #141
Apocryphon wrote: post #56

The official reason is because of housing: "To be clear we will be continuing to expand our activities in California," Musk said. "Our intention is to increase output from Fremont and Giga Nevada by 50%. If you go to our Fremont factory it's jammed." But, he added, "It's tough for people to afford houses, and people have to come in from far away....There's a limit to how big you can scale in the Bay Area." https://ww…

As someone who just bought a house in Austin this year, if the reason is "affordable housing", they're in for a world of hurt.

"Its a house michael, how much could it cost? 2bn?"

Re: Tesla’s headquarters will move to Austin

#178

Post by notJim »

gautamcgoel wrote: post #48

What I'm really curious about is what happens to Austin (and to a lesser extent, Atlanta, Raleigh, Denver, SLC etc). Does Austin become the next Bay Area/next Seattle? Crazy high housing prices, and high homelessness/crime? If so, how long does that take, and what happens to native Austinites? If not, what prevents history from repeating itself?

If they don't build housing, they will rapidly have all these problems. There's no magic here, no curse on the Bay Area and Seattle, it's all economics, though the geography of SF and Seattle don't help. From cursory Googling, it looks like Austin is beginning to upzone areas so that apartments can be built, which is a step in the right direction. From what I understand, Austin has already been struggling with affordable housing, so I don't think the outlook is very good.

Re: Tesla’s headquarters will move to Austin

#179

Post by thebradbain »

asdff wrote: post #159
etchalon wrote: post #141

Earlier quoted context omitted.

As someone who just bought a house in Austin this year, if the reason is "affordable housing", they're in for a world of hurt.

Property taxes are higher than California, right? I can't find the source handy at the moment, but I've heard that a house in Austin that looks like a couple hundred grand cheaper than an equivalent house in California for the listing isn't actually any cheaper when you factor in the increased taxes and potentially other costs I'm not aware of.

Property taxes are _much_ higher in Texas than California, in fact Texas has one of the highest property taxes in the nation (because there's no income tax, and TX still needs to fund itself somehow; TX also has one of the highest sales taxes for this reason, too). You pay the same on property taxes for a $400k house in Texas as a $1M house in California.

Not only that, CA has Prop 13: for better or worse, your property tax is essentially frozen in the year you buy your home in CA. In TX it increases with the market value every year. And the assessors are ruthless – market value of your home went up by 20%, as they have the past few years? Expect your tax bill to too (granted, I believe legislators have restricted this to a maximum increase of 8% a year as of this session, but I believe localities are still allowed to exceed that in some cases).

Source: I'm from Dallas, and a homeowner in Los Angeles. Though rates are publically available:

https://smartasset.com/taxes/california-property-tax-calcula...

https://smartasset.com/taxes/texas-property-tax-calculator

Re: Tesla’s headquarters will move to Austin

#180

Post by zeruch »

paxys wrote: post #122

Whenever I read news like this I can never figure out what moving a company's headquarters actually means. Musk has already been living in Texas for a while. Tesla already has sizable operations there (both offices and factories). The company is registered in Delaware, so legally this change means nothing. They aren't going to fire employees in California or force them to move (in fact Musk said that they will contin…

It's a PR move to cow CA politicians to be more amenable to C-suites without challenge.

It's theater. Petty, obstinate, twattish theater.

Post reply on HN