In response to the Texas governor, firms transferring their headquarters to the state have become a tidal wave.
Texas governor Greg Abbott told CNBC on Friday that the number of companies relocating their headquarters to the Lone Star State has accelerated in part due to the coronavirus pandemic.
The Republican governor's comments came shortly after it was reported that software giant Oracle was moving its corporate headquarters from Redwood City, California, in Silicon Valley, to Austin, Texas. Hewlett Packard Enterprise announced earlier this month that it is moving its headquarters from San Jose, California to Houston. Real estate giant CBRE officially relocated its headquarters from Los Angeles to Dallas in early fall.
"I've been on the phone with CEOs across the country weekly, and it's not just California," Abbott told Fast Money, referring to his meeting with Nasdaq officials last month. "We're working across the board because the times of Covid revealed a lot. They revealed … that, for example, you really don't have to be in Manhattan to be involved in the trading business or the investment business."
In addition to the pandemic demonstrating the feasibility of more widespread remote working, Abbott said there are other characteristics that are pulling businesses to Texas. "Business costs mean a lot. No income tax means a lot, but the freedom to operate without the strict hand of regulation also means a lot," he said.
"This has become an absolute tidal wave," added Abbott, while many companies like Oracle were in Texas prior to their official announcements. "They are looking for a state that gives them the independence, the autonomy and the freedom to set their own course."
Abbott also cited Texas’s relationship with Elon Musk, the executive director of electric vehicle maker Tesla and SpaceX, as evidence of the state’s growing appeal to business leaders.
Musk personally moved to Texas from California, and earlier this year Tesla announced that it had selected a location near Austin to build its next U.S. factory. SpaceX also has a growing facility in Boca Chica, Texas, on the Gulf Coast. "Elon is delighted to be here," said Abbott, adding that the two men "talk to each other practically weekly."