Nissan to Move It's Headquarters

Thursday, November 10, 2005
In one of those stories that gets some coverage but maybe not as much as it should, Nissan announced it would move its North American headquarters from California to the Nashville area. It had been in the Gardena area for over 45 years and hired 1300 people.

Why do I care? Well, this is just one more example of why we in California really need to worry about our economy. The main reason given for the move is lower real estate cost and lower business taxes.

I have harped over and over in this blog about why California is not a good place to do business. It's really a shame because it really does have a tremendous advantage in that it is so close to the budding Asian economy and that it is an attractive place for young people to live.

But California is just too expensive. This point hit very close to home for me. When my company was bought out and one of the recurring themes I heard was how expensive our facility was here compared to the facility in Ohio. They have something on the order of 3x or 4x the square footage for about the same cost as we do. Add on top of that that California has some of the highest taxes in the country to pay for its numerous social programs and the picture gets bleaker.

Then my very successful friends told me how they would probably not move to California. Housing prices are too high for someone just getting started to afford anything decent. And California imposes an average of 7% tax (more on high income individuals) on income compared to many states 0%. These are people who will be earning six-figure incomes and they are telling me it is too expensive to live here?


David Cho said...

I live here because I earn 6 figures.

(In pesos)

Ryan said...

Whoever said a six-figure salary isn't enough to live here is either hugely misinformed or has a very strange definition of "to live". Tens of millions of people live in California on less than six figures. It really bothers me how so many comfortably well-off people talk about being "able to live" when they really mean "able to maintain a life style superior to the average person's". I often hear people say, "sheesh, you can barely survive on $60k if you live in LA/Orange County/SF." I know they don't mean it literally, but it really speaks of an ignorance of what "surviving" really means. Millions of people survive on a fraction of what even I make, and I live quite contently in a nice part of LA for well under $40k/year.

I wish people would just be honest about what they mean instead of talking about "surviving" or "living". I would love to hear someone say, "I can't afford to maintain my snobbish spending habbits and unnecessarily expensive life style in LA."

T said...


I'm sure you understand what is meant by being able to "live".

By no stretch of the imagination is it impossible ot "live" on a six-figure income. However, living conditions are relative. You can live much more comfortably in Texas on six-figures than in San Diego where you can get 4x the house for 1/2 the price.

And I would hardly call it a "snobbish" attitude. Most americans could probably get by on much less than they make but one of the things that makes this a great place to be is that we can do more than just survive. If life makes available a more comfortable and luxurious life than people should take advantage of it.