Elon Musk says this is the last straw and he is moving his businesses out of California. The disagreements between Musk and Newsom are not new reports show Elon Musk was already making plans to move away before Newsom signed this bill, but he'd already moved Tesla to Texas three years ago in the economic expert I spoke to says this is not good for the local economy. Elon Musk moving the headquarters for his companies, SpaceX and X, from California to Texas. This comes after the state banned school to inform parents about their child's gender identity change.
It's the first law like it across the nation, signed by Governor Newsom on Monday, the tech billionaire wrote on his platform X this is the final straw because of this law and many others that preceded it, attacking both families and companies. SpaceX will now move its HQ from Hawthorne, He also says X will move from San Francisco to Austin, Texas. Tesla headquarters were already moved from Palo Alto to Austin in 2021, after Musk criticized California tax regulations.
Corporate business expert Mitchell Lee says it may not make a big impact on the state, which touts having the fifth largest economy in the world. But the loss could be felt in local economies like San Francisco, which has already taken a hit by the loss of corporations downtown, for example, with fewer high earners comes fewer crowded restaurants for lunch. I'm thinking now about the mom and pop shops.
Even the chains that employ people at minimum wage. But Musk is not the only one. There's a growing trend of corporations leaving California as cost of living goes up. In the last several years, a couple of hundred businesses have left California. those businesses have relocated in Texas. What's unique in this situation is a big corporation leaving because of a difference reasons. In another post, Musk wrote, I did make clear to Governor Newsom about a year ago that laws of this nature would force families and companies to leave California to protect their children. In a response on X, Governor Gavin Newsom shared a screenshot from Donald Trump, implying Musk begged Trump for support for his tech projects.
It reads in part, I could have beg, and he would have done it in a witty response, Newsom writes back, you bent the knee, insinuating Musk was just appeasing Mr. Trump for financial gain. There's no word on a timeline for a move, but it's likely certain factories will stay put. Like Tesla's Fremont factory did after the headquarters moved to Austin and the governor's press office headquarters moved, the company expanded in California.
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