Los Angeles County business development officials are devising plans — including possible tax breaks — to persuade Nissan Motor to keep its North American headquarters, and its 1,300 employees, in Southern California, rather than move them out of state, the Los Angeles Times reported.
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A “strike team” reportedly includes representatives from the governor’s office, the Los Angeles County Board of Supervisors, Southern California Edison [a utility company], the state economic development department and the Gardena and South Bay economic development agencies.
Two weeks ago, The Times reported that Nissan was studying a move out of Southern California as a cost-saving measure, citing sources inside and outside the company.
The paper said the study stems from Nissan chief executive Carlos Ghosn’s global drive to slash the company’s operating overhead costs. The Times report said Nissan was considering moving some or all of its Gardena-based sales, marketing, distribution and advertising staffs to its manufacturing headquarters in Smyrna, Tennessee, near Nashville, or to its finance arm’s service centre near Dallas.
According to the Los Angeles Times, Nissan chose the South Bay of Los Angeles County for its headquarters when it first entered the US market in 1958. Its Gardena headquarters is within a few miles of the US headquarters of Toyota and Honda in Torrance.
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By GlobalDataThe paper noted that Southern California now is headquarters to all but one of the 11 Asian automakers doing business in the US.
The newspaper said Nissan executives have declined to comment publicly about the relocation plan and, on Sunday in New York, Ghosn dismissed reports that the company might move its North American headquarters as “rumors and speculation.”
But on Monday, Ghosn reportedly acknowledged the relocation study in a speech to employees in Smyrna, according to several Nissan workers in Gardena who viewed his remarks on a closed-circuit broadcast. The LA Times said Ghosn told workers that a decision on the North American headquarters location would be made by the end of November.
Nissan reportedly also has sent employees in Gardena an e-mail message acknowledging the relocation study. The message, a copy of which was obtained by The Times, said the study “is part of our ongoing efforts to take advantage of synergies, to increase efficiencies and to add value.” It added that no final decision had been made.
The Los Angeles Times said a spokesman for California state governor Arnold Schwarzenegger told Bloomberg News that his office had contacted Nissan and offered to provide any assistance that could help “inform the company’s decision-making process.”
An Economic Development Corporation spokesman told the Los Angeles Times that local officials were still working on their incentive package and had not yet contacted Nissan.
Although significant tax breaks would require legislative action, local agencies could provide Nissan with job training and recruitment programmes, reduced business license and other fees, and improvements to ease traffic around its headquarters, he reportedly said.
