Toyota's surprising announcement on Monday that it will move its North American headquarters from Torrance, CA location to the Dallas suburb of Plano, TX is allegedly not due to any political wrangling from the state's Republican governor, Rick Perry.

Perry (above) has been up front in his aggressive pursuit of businesses and jobs for Texas, traveling to California, Missouri, Illinois and New York to tempt corporations to his state. And it's not just about the promise of much lower taxes, a Perry spokesman reminds Automotive News that the state boasts, "a workforce that is skilled and ready to do any job."

For his part, Jim Lentz, Toyota's North American CEO said Plano was chosen through an internal process, with the location helped by its proximity to the company's massive pickup factory in San Antonio rather than any campaigning from the governor.

Lentz explained the selection process that led to Toyota choosing the Lone Star State as its new headquarters to Automotive News: "When we made the decision that we weren't going to go to one of our three existing locations, our search started with about 100 different cities. We put together a decision matrix that put together economic considerations, business considerations, associate considerations," Lentz says. That left the company with 100 cities, which were pared down to 25, then down to seven, which were then split between four "primary locations" and three "secondary locations." Lentz wouldn't elaborate on what other cities were competing with Plano. "We visited all four of those primary locations and it became quite clear that [Dallas] was the primary choice," Lentz told Automotive News.

As The Wall Street Journal points out, however, Toyota is clearly getting a sweet deal to make the move south, including hefty state incentives out of the Texas Enterprise Fund to the tune of $40 million dollars – an estimated $10,000 per job. The WSJ notes that the latter figure is "one of the largest incentives handed out in the decade-old program and cost more per job than any other large award."


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 86 Comments
      rstrnad
      • 1 Month Ago

      California car buyer's bought more Toyota's and Lexus's then the next 10 states combined. I don't believe their crap about how they chose PLano, Texas. It sure as hell wasn't the weathjer. Californianians, buy any other car you like, except, Toyota and Lexus. Remember Pearl Harbor!!!  

      Greg
      • 8 Months Ago
      Good for Texas for trying to get jobs to their state, but what if every state acted like Texas? The Texas model: Spend little on education and rely on other states to educate the people moving to your state....Throw your citizens tax money at companies to move there....be okay with a tiered society with rich people and poor people...and lots of oil. The first one is basically not sustainable long term, the second only works until other states do the same, the third in not sustainable long term and its sketchy making the poor pay a disproportionate amount of the taxes though sales tax, the last is just dumb luck and also will not last forever. My feeling is that Texas will continue to grow, but it is inside of a bubble that will burst sometime down the road.
        Larry Litmanen
        • 8 Months Ago
        @Greg
        Texas has great schools. Don't you get it, the reason Texas provides everything at super low cost is because it is not over run by liberals and public employee unions. In NY a teacher can retire making 200K until she dies, that does not take place in Texas so taxes are low and everything costs less. You can actually buy a nice house in a great neighborhood for $200,000. You can not buy a 1 bedroom for $300,000 in Brooklyn let alone Manhattan.
          Greg
          • 8 Months Ago
          @Larry Litmanen
          Yeah, I can tell by your writing and logic that you may have gone to a Texas school. Also, a house is more expensive in Brooklyn because people actually want to live there and the demand is high, not because teachers are making a lot of money. Your $200,000 sprawl Plano construction in TX is cheap because the demand is relatively low. You can get a mansion in Detroit for $100,000.
          superlightv12
          • 8 Months Ago
          @Larry Litmanen
          Wait. That will all change. Texas WILL become the next California. Demand drives greed. Texas will have no choice but to raise taxes to pay for the massive infrastructure improvements they will need. Houston is the fourth largest U.S. city and has no rail service. Imagine the cost to build one now. Look at California or New York, and you will see the future of Texas.
          Mercennarius
          • 8 Months Ago
          @Larry Litmanen
          Greg, Texas real estate is by and large the hottest market in the country. Property values were rock solid through the recession and have kept it there. Demand is high and Texas cities are the fastest growing and are receiving the highest # of people moving from out of state. The difference is Texas doesn't see the huge swing in prices that you will see in NY or CA or other states. Prices are not going to double every 4-5 years like you see in Socal or other parts of the country. The economics are just different in Texas.
        MrMonkaroo
        • 8 Months Ago
        @Greg
        Texas has always had a self sustained economy....there is no bubble.
          Greg
          • 8 Months Ago
          @MrMonkaroo
          HAHAHAHAHA Self sustained? Cheap labor from Mexico? Selling oil to the rest of the work that it pumps out of the ground for free? Infrastructure built by the federal govt? What part of Texas economy is self sustaining again?
        car czar
        • 8 Months Ago
        @Greg
        As a Texan. We don't have a bubble economy but the wealth gap between the rich and poor is big enough to drive a truck threw. As one of major candidates put it we have seen year over year growth but all the jobs have been created in the service industry. 80% of the jobs that have been created in the last ten years pay an average of 8/hr. No hope of passing a minimum wage so that gap will continue to grow. Public schools are a joke filled with legal aliens who increase the classroom size making it even worse. My daughter class had to get a state waiver, the ratio in my daughter school is 24/1 how is she suppose to get a great education with 24 other first graders. The teacher even admitted to me that she had to go home several times from stress and headaches. So why everyone on here looking from the outside in take it from someone from the inside its not all roses in the Texas.
        MrMonkaroo
        • 8 Months Ago
        @Greg
        Texas has always had a self sustained economy....there is no bubble.
      knightrider_6
      • 8 Months Ago
      Let me get this straight - Texas blew $40 million to create ZERO new jobs in America? Nicely done!
        Neez
        • 8 Months Ago
        @knightrider_6
        No, they paid $40 million to bring 1500 jobs to the state. Plus potentially more if toyota decides to increase production at their san antonia plant with another model. It's the presidents job to bring jobs to the country, he's failing miserably, pretty much blew $90 billion to create green jobs, and only Tesla is came out of it. Most of the other companies he helped startup are in distress or bankrupt. That's a huge waste of money. $40 million to steal toyota from california is simply a good investment.
        zepeda1
        • 8 Months Ago
        @knightrider_6
        Is it Texas' job to create jobs for all of America or just Texas?
          knightrider_6
          • 8 Months Ago
          @zepeda1
          Is Texas part of US? Yes Does Texas depend on Federal dollars to sustain it's economy? Yes Is is Texas' job to help the country? Absolutely!
        Mercennarius
        • 8 Months Ago
        @knightrider_6
        Texas cares about creating jobs and boosting the economic climate for Texans. States have their own politics for a reason...most Texan's would never live in Communistfornia. If the entire country looked like California did we would have never made it out of the recession..
        MrMonkaroo
        • 8 Months Ago
        @knightrider_6
        Wrong. They are hiring up to 2,000 people in DFW area. The tax revenue alone will easily offset $40 million.
      icemilkcoffee
      • 8 Months Ago
      Nice. $40million welfare check. That's republicanism for you. No welfare for starving kids, but plenty of welfare for rich foreign corporations.
        blasds78
        • 8 Months Ago
        @icemilkcoffee
        ....as if other states (Democratic California included) don't have their own incentives
        OptimusPrimeRib
        • 8 Months Ago
        @icemilkcoffee
        It's not welfare if Republicans or the rich use it.
        Mercennarius
        • 8 Months Ago
        @icemilkcoffee
        You sound SMART!
          icemilkcoffee
          • 8 Months Ago
          @Mercennarius
          Not as smart as those corporate honchos who managed to get TX tax payers to pad their bottom line.
          Mercennarius
          • 8 Months Ago
          @Mercennarius
          FWIW California was also offering up "incentives" to KEEP Toyota there. No amount was disclosed but the California did "everything we could" to try and keep Toyota. They very well may have offered more than $40 Million...which by the way is really not very much money at all in the grand scheme of things. The tax revenues will pay that back in less than a year.
        Neez
        • 8 Months Ago
        @icemilkcoffee
        How is this welfare??? Texas isn't just giving money out freely with no expectations in return. They expect to add thousands of jobs to the area, who will pay back the $40million. Funny how obama gives $465million to Tesla and the liberals don't bat an eye.
        juststudent
        • 8 Months Ago
        @icemilkcoffee
        I'm not american, but I prefer to make a country richer than to feed 'starving kids' forever (Although I believe you american don't know what REAL poor means). If those $40m make job for thousands families, why not? It'll freed some welfare slots (well here goes the starving kids), make way to the new generations while turning tax to the country. $40m is nothing compared to that.
      Hokiegrad09
      • 8 Months Ago
      It really annoys me that governors try so hard to take business away from other states instead of focusing on all the jobs they send overseas. Taking business from one part of the country to another doesn't help the country as a whole
        Neez
        • 8 Months Ago
        @Hokiegrad09
        That's the presidents job, but he's too busy giving everything away to focus on jobs.
          BipDBo
          • 8 Months Ago
          @Neez
          That's the difference between incentives that cut taxes for putting people to work vs. paying people not to work.
        BipDBo
        • 8 Months Ago
        @Hokiegrad09
        Competition between consumer product companies is good for both the consumer and the progress of the product. It seems like similar principles would apply for competition for jobs between states. Also, competition between states would make each state more appealing compared t each other, but at the same time, as compared to other countries. A lot of the responsibility of being competitive on an international level, however lies in the federal government.
        Mercennarius
        • 8 Months Ago
        @Hokiegrad09
        Actually governors do in effect compete with other countries for jobs, each state is a representation of America as a whole. Texas(and a few other states) are doing many good things to bring Jobs TO America, other states like California have so many backwards policies its forcing business away. Luckily we have states with different politics so the states promoting positive economic policies will prosper and force other states to try and compete.
      Lunch
      • 8 Months Ago
      You don't need Perry to get CA companies to leave CA. CA does a really good job chasing corporations away on their own. One would have to be crazy to start a business in CA.
        raughle1
        • 7 Months Ago
        @Lunch
        Yeah, except that Californians start more businesses per capita than Texans. 400 per 100k residents in CA last year vs 320 for TX according to the annual Kauffman index. I think people are so bought in to their political positions that they aren't willing to believe anything that doesn't fit their narrative. If you only get your info from media that support your biases, you miss a lot of important facts. This is why Californians think Texas is an industrial cesspool full of low wage jobs and Texans think California is some kind of hippy welfare state with an imploding economy. When it comes to the things that matter, CA and TX are actually a whole lot alike.
      raughle1
      • 8 Months Ago
      Funny how nobody ever mentions all the other taxes that are much higher in Texas. Many localities in Texas have property tax rates that are more than twice what is common in the rest of the country. I owned a business there until last year, and while the lack of income tax is sweet, our local property taxes were incredibly high, and the county assessor raised our assessment by double digits every year between 2006 and 2011, doubling our overall tax burden. That's on top of the franchise tax that every Texas business pays, and the industry-specific occupancy taxes (this was a hotel) collected by the county and the city which also both went up during that timeframe. Not to defend California, but it is illegal there to raise property taxes by more than 2% per year due to 1983's Prop 13. Occupancy taxes just across the border in Louisiana were zero, which was another drug on our competitiveness. And don't even get me started on the Texas Workforce Commission, who collects the state payroll taxes (yep! Texas has those too!). I could have an employee not show up for shifts for an entire week, and those hooligans would deny my claim that they were fired for "cause" and simply call it a layoff so that I'd have to pay additional unemployment taxes for them after I fired them. I don't know about Dallas, but southeast Texas is straight-up welfare country. I know this doesn't fit the rah rah narrative from other commenters here (and I'm certainly not defending CA's tax structure), but let's call a spade a spade. There is no free lunch.
        Larry Litmanen
        • 8 Months Ago
        @raughle1
        So you think Toyota did not study the move before they made it? You think all these businesses that move to Texas don't know what you know?
        thedriveatfive
        • 8 Months Ago
        @raughle1
        Your right texas has property tax. Its 1.81% on average. (http://taxes.about.com/od/statetaxes/a/property-taxes-best-and-worst-states.htm). Compare that to californias average tax burden of 11.35% (http://taxfoundation.org/state-tax-climate/california) I guess you will have to decide which is worse for you.
          rcavaretti
          • 8 Months Ago
          @thedriveatfive
          Your numbers are wrong. While these figures are from 2007, it still shows Texas prop. Taxes as excessive . 2.57% vs for example California's average of 0.68 http://www.nytimes.com/2007/04/10/business/11leonhardt-avgproptaxrates.html?_r=0
        MrMonkaroo
        • 8 Months Ago
        @raughle1
        And yet all these people keep moving here...Dallas is a nice city. I have heard that from people from all over. Furthermore, every state has it's welfare issues. That is common all the way around. However, some states make it easier to raise above the poverty
      D210
      • 8 Months Ago
      Toyota sucks
      twentyoneautospies
      • 8 Months Ago
      Democrats are spinning like crazy trying to explain this. LOVE IT
        Neez
        • 8 Months Ago
        @twentyoneautospies
        They'll just do what detroit did, and blame it on the republicans in some way. I'm sure there's a few republican's in the state somewhere they can blame it on.
        jase.s
        • 8 Months Ago
        @twentyoneautospies
        Go read up on the Texas budget practices (from an official source, not some random blog). That $40m in incentives? The Federal Government will end up paying that. Rick Perry and the State legislature have done a pretty good job of fooling people into thinking the state is self sufficient and profitable.
          knightrider_6
          • 8 Months Ago
          @jase.s
          shhhhh! Don't burst the little bubble teabaggers live in by using facts and logic.
      scott3
      • 8 Months Ago
      The cost of doing business and cost of living is much cheaper there due to the government and the way they deal with the taxes and business climate. You can dispute it all day long but we live in a capitalistic country and the area that provides a better business climate gets the jobs and those who don't lose them. Those who win the jobs tend to prosper with out any additional government social intervention and the standard of living tends to increase. Those who want to deny this can continue all they like but the proof is out there and if you only open your eyes you will see it. But with nearly half of the country on the government rolls I would expect half to disagree. Their way of thinking is why should I learn to fish when someone is going to give me a fish dinner. Sad but true. Too many live and vote the entitlement society and when you let the people vote the treasury the country will go broke as Thomas Jefferson once observed looking at the once invincible Roman empire the vanished into ruins.
        TruthHertz
        • 8 Months Ago
        @scott3
        Also, the property taxes are either payed by the owner, or the person renting from the owner. You live there, you pay taxes.
          scott3
          • 8 Months Ago
          @TruthHertz
          Like stated the cost of living and to do business there is less no matter what tax etc. anyone wants to quote. The bottom line it is more profitable for companies and the residence to live there as more tangible things cost less in the big picture.
      viggen
      • 8 Months Ago
      Bottom line is Texas is much, much more business-friendly, more citizen friendly (no state income tax) and the state is far more financially stable than California. There's a reason California leads all states in business exits.
      viggen
      • 8 Months Ago
      PS -- To almost everyone who has posted below, focusing on political mudslinging rather than business, just a note. I've been involved in creating several studies/recommendations to determine optimal locations for new manufacturing facilities, businesses, etc... The southern and southeastern states make an aggressive push to move jobs to those parts of the country -- they tend to offer a mix of lower taxes, far less regulation (a primary reason companies choose to leave California) and a workforce that understands the value of work and workers who don't believe they should be forced to join unions... It's a pretty easy business case to make to be honest.
    • Load More Comments