After more than 145 years of having its main headquarters in California, Chevron has announced that it will be leaving the state for Texas. However, the move will not be instant, and is expected to take around 5 years to complete.
Chevron plans to eventually have all its major corporate offices and functions located in Houston, Texas by the end of that 5 year goal, with its major corporate officers, Chairman and CEO Mike Wirth and Vice Chairman Mark Nelson, to move by the end of this year. The company has already been making gradual moves prior to the announcement with a number of other employees and positions.
In a press interview, Andy Waz, Chevron President of American Products, stated, “We’ve been doing that because California is a tough place to do business,” he said. “It’s a tough place to recruit people. It’s a tough place to move employees – a lot of our employees move up through the company, they gain experience in different geographies, different locations and we have a lot of people who will not move to California. That makes it difficult.”
“We have been moving the company’s employee base to Houston for a long time. This is another step on that journey,” Walz said. “We’re doing that because it’s going to drive better performance for Chevron. Today, our leadership teams are spread across two different states, we’re not together as much, so there’s efficiencies, there’s effectiveness by doing that.”
Walz also went on to say the move wasn’t politically motivated but had more to do with the overall company needs and employee costs of living being better met in a more friendly state such as Texas.
“I will tell you, in Texas, we’re welcome. Our industry is welcome,” Walz explained. “This is where a lot of our competitors are, a lot of our suppliers, a lot of the people we do business with are here. It’s easy to walk across the street and talk to somebody that you’re doing business with. The policies are welcoming of energy companies. And quite frankly, it’s lower cost of living, and it works well here.”
It is no secret though that Chevron, and similar companies, have had issues with Sacramento leadership for quite some time. But Chevron is only a part of the much larger industry sector that has steadily been leaving the state for friendlier ground.
And though the oil and gas industry has been a large part of what has shaped California for over a century, the state finds itself more and more focused on service-based sectors and tech sectors – such as Silicon Valley, which ironically, have also started to leave the state. This may not be the best choice in California policy, considering the state has seen an exodus of population, with a net loss especially over the last 4 years – with figures ranging in the hundreds of thousands, not to mention the more than the more than 400 companies that have already left the state in the same amount of time.
In other similar cases recently, Elon Musk has also stated that he plans to move his Space X and X out of California in favor of Texas as well.
In typical fashion, Sacramento leadership, and Governor Newsom, appear to downplay the significance of these moves as well as the population loss. Either that, or some of attempted to go on the offensive and threaten lawsuits – which is difficult to understand how that would work exactly. But certain parties have threatened to continue lawsuits against Chevron, citing environmental concerns and climate change policy.
“This announcement is the logical culmination of a long process that has repeatedly been foreshadowed by Chevron,” said Alex Stack, a spokesman for the governor’s office. “We’re proud of California’s place as the leading creator of clean energy jobs — a critical part of our diverse, innovative and vibrant economy.”
While California has been developing a road map to “clean energy” jobs, it is not exactly transparent on how it will address the serious impact of losing refinery jobs, and gas and oil jobs across the state. Especially in the midst of rising costs and decreasing population.
Another major issue, despite the Governors offices holding on to belief that “clean energy” is somehow going to offset these issues, is that nearly 70% of California’s fuel demands are being imported from other states, with more than half of that from other countries – and somehow it still supports other states fuel demands, such as Nevada & Arizona. Some of the math might not make total sense here from what the Governors office wants us to believe.
It is worth noting that even though Chevrons main corporate headquarters will be moving, they still will continue to have business in California, and are not totally shuttering all their offices in the state. But it is yet unclear the loss to California tax income and the affect this will have on the overall California economy, especially in the areas that these companies have been trying to keep thriving in.
