Citing an inability to scale at the pace he wants, Tesla Inc (NASDAQ:TSLA) chief executive and founder Elon Musk says he plans to move the company’s headquarters out of the Bay Area close to San Francisco.
He is headed south and east to the newly emerging tech hub of Austin in Texas, following a whole host of businesses beating the same trail - including Amazon, Google, Facebook and Oracle.
"There's a limit to how big you can scale it in the Bay Area. In Austin our factory is like five minutes from the airport, 15 minutes from downtown," he said.
A magnet for technology companies, San Francisco and the surrounding areas such as Silicon Valley are struggling to cope with their position as the epicentre of the world’s digital revolution.
It has sparked a two-decades-long influx of talented, highly paid coders and engineers.
As a result, house prices in this corner of northern California are some of the highest in the US.
The city, meanwhile, has a now not-so-hidden homelessness problem as the poorer members of society have struggled to find and pay for accommodation.
As was Musk’s complaint, carving out room to grow a business is becoming an issue too.
He has had a fractious relationship with local politicians as he has looked to expand Tesla.
While he is setting up shop in Austin, Musk said that the company still planned to increase output from its California and Nevada factories by 50%.
"This is not a matter of, sort of, Tesla leaving California," he said.