California Exodus Intensifies as EV Producer Announces Move to Texas for Lower Taxes, Less Regulation

EV Startup Canoo is the latest company to ask its employees to leave California for more business-friendly pastures.The Torrance-based automotive manufacturer recently revealed in its quarterly filing to the Securities and Exchanges Commission (SEC) that it has offered to relocate most of its employees from southern California to Texas or Oklahoma, according to The Houston Chronicle. About 140 of its 197 employees at its facility in Torrance will be offered the option to move, while the rest will be laid off.Earlier this month, executives also announced during an all-hands-on-deck meeting that they would be moving their headquarters to the Dallas-Fort Worth Metroplex at north Texas.Canoo, which manufactures commercial electric vehicles, is just the latest company to flee the Golden State in favor of setting up shop in Texas, which is known for its low tax burdens, business-friendly regulations, and low unemployment rate. Numerous companies, including Fortune 500 list makers such as Chevron, Charles Schwab, Hewlett Packard, and commercial real estate firm CBRE, have shifted their primary operations to the Lone Star state to combat the high cost of dealing with supply chain issues, inflation, and retaining skilled laborers. Most famously, Elon Musk has moved nearly all his business holdings, including Tesla and The Boring Company, to the Austin Metro Area at central Texas, with plans to move X (formerly Twitter) and Space X as well.The exodus of businesses from California has helped make Texas the state with the highest number of Fortune 500 companies in America, with 55 in total.The seismic shift has led California to hemorrhage tax revenue, losing nearly $80 billion between 2019 and 2022 as residents fled for other parts of the country. In contrast, Texas gained $31 Billion in taxes during the same period.In line with most progressive-friendly states, California continues to enact policies that increase the cost of living for many of its lower and middle-class residents. Recent climate mandates and tax policies are poised to raise energy costs within a state that is already one of the highest in the nation. In comparison, Texas has a lower cost of living and energy, has no personal or corporate income tax, and was recently dubbed the best state for business in 2024.

California Exodus Intensifies as EV Producer Announces Move to Texas for Lower Taxes, Less Regulation

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