Tesla Inc. doubles its presence in California by establishing its global technical headquarters in Palo Alto. The move comes after CEO Elon Musk moved the company’s headquarters from Silicon Valley to Texas in 2021, citing limited scalability in the Bay Area.

Despite the move, more than a third of Tesla’s global workforce is in California, with many working in Fremont, the site of the company’s first car manufacturing plant. Musk confirming that Tesla would continue to invest in California was a big change from his earlier comments. As the Wall Street Journal noted, in the past Musk likened the Golden State to a winning sports team, building on his reputation for success. The state tends to “get a little bit complacent,” Musk said, “a little bit entitled, and then they don’t win the championship anymore.”

On Wednesday night, in the presence of Governor Gavin Newsom, Musk was more optimistic, promising at the Palo Alto event that Tesla will “build the future here.”

Tesla has not been immune to layoffs at other California tech giants. It laid off more than 200 people in 2022 due to the closure of its San Mateo office location, home to staffers who work on Tesla’s advanced driver assistance system, Autopilot.

Tesla aims to sell 20 million vehicles annually by the end of the decade. In addition, the company recently unveiled potential expansions at its $775 million plant in Austin, Texas.

In Palo Alto, Musk expressed optimism, saying that Tesla would “build the future here.” Despite his previous criticism, he acknowledged California’s importance to the company, stating that Tesla still employs approximately 48,000 Californians and that the state will continue to be an integral part of the company’s growth.