Recently, billionaire entrepreneur Elon Musk announced that he had officially relocated SpaceX’s incorporation from Delaware to Texas. Musk has demonstrated an affinity for the Lone Star state in recent years, where he also moved the Tesla headquarters from Palo Alto, California, to Austin, Texas.
On Wednesday, Musk celebrated the official move while simultaneously urging other states to do the same and take their businesses out of Delaware. Musk’s decision to move the company followed a ruling from a Delaware judge that sided with a Tesla shareholder who complained that Musk’s compensation package was unfair.
“SpaceX has moved its state of incorporation from Delaware to Texas! If your company is still incorporated in Delaware, I recommend moving to another state as soon as possible,” Musk wrote on X. The SpaceX CEO has also considered officially incorporating Tesla in Texas as well after a shareholder vote.
“Move your company out of Delaware before they lock the doors, as they just did with Tripadvisor,” Musk said in late January just after Delaware judge Kathleen McCormick ruled against his nearly $56 billion compensation package. According to McCormick, the deal was negotiated in a “deeply flawed” manner.
“In the final analysis, Musk launched a self-driving process, recalibrating the speed and direction along the way as he saw fit,” McCormick said. “The process arrived at an unfair price. And through this litigation, the plaintiff requests a recall.”
Musk’s move to relocate SpaceX’s incorporation has raised eyebrows, as some speculate if this could spark a seismic shift in companies fleeing to Texas. Delaware has been historically known for being a “corporate-friendly state,” where the vast majority of Fortune 500 companies are incorporated and IPOs are registered.
The Kobeisi Letter wrote in the comments section of Elon’s post, “Over 60% of all Fortune 500 companies are currently incorporated in Delaware. Nearly 80% of all IPOs in the United States are registered in Delaware. Delaware was known to be a corporate friendly state. Is this the beginning of a major corporate shift away from Delaware?”
Some users agreed with Musk’s skepticism about the judicial integrity of the state. “Delaware cannot be trusted — sleazy state officials retaliating against you and your company simply because you spoke out against Crooked Joe Biden’s horribly dishonest and corrupt administration,” one person said.
In January, Musk posted a poll on X that asked users if they would support Tesla moving its incorporation to Texas. “The public vote is unequivocally in favor of Texas! Tesla will move immediately to hold a shareholder vote to transfer state of incorporation to Texas,” Musk said when 87% of respondents to the poll voted in support of the potential move.
Elon Musk has dominated headlines recently, not only for his prowess in the world of business but also for his criticism of the woke agenda. During a panel with conservative icon Ben Shapiro, Musk slammed DEI. “You should always be wary of any name that sounds like it could come out of a George Orwell book,” Musk said. “What it really means is discrimination on the basis of race, sex, and sexual orientation. And it’s against merit, and, thus, I think is fundamentally anti-Semitic,” he added.
