What Was The Amazon’s HQ2 Fiasco About? Was Jeff Bezos Operating Out Of Jealousy?
With Jeff Bezos’ recent visit to India, a lot has been already talked about Amazon’s upcoming plans. However, there were times when Jeff Bezos had displayed some unexpected behaviour. What was this fiasco concerning Amazon’s HQ2 all about then? Scroll down!
It has been for years now that Amazon’s economic development team has been following a well-trodden process, that has dubbed the ‘welcome wagon’ internally, and also led the country to begin building warehouses in towns and cities. Most of these were around Amazon’s HQ2.
During the time that Elon Mush had secured $1.3 billion from Nevada in 2014 while opening a gigantic battery plant, Jeff Bezos had taken well notice of the same. During meetings, Jeff Bezos had majorly expressed his envy for Musk. He specifically stressed on the fact that Musk had pitted five Western states against one another, in a bidding war. This was increasingly for manufacturing jobs.
An Amazon executive had sent a congratulatory email in 2017. This mail had encouraged Amazon team members for landing a $40 million in government initiatives. The aim was to build a $1.5 billion air hub near Cincinnati, Ohio. People aware of the matter said that this move made Bezos even more determined to try out something new.
Finally, in 2017, Amazon had launched a bakeoff for a second headquarters, called Amazon HQ2, in September 2017. Amazon had made it plain that it was looking for government handouts, in exchange for a pledge to invest around $5 billion and hire around 50,000 people. The media had covered this event pretty well, and many people had come in from around 238 cities across the world. This had ended when Amazon had decided to split the HQ2 between New York and Virginia. However, progressive politicians had attacked the $3 billion in incentives, that was offered by Bezos, and he had pulled out.
Ridiculed By New York Politicians
There was huge ridicule for Amazon for its failure to court New York politicians. International publications have stated that Amazon had depicted a team that had become the victim of its own hubris.
There were employees with considerable experience negotiating deals across the country, however, these flags were often ignored.
Amazon’s Economic Development Plan
Amazon has been following a well-trod process for a very long time. This had dubbed the ‘welcome wagon’ internally and has also developed when Amazon built warehouses around the US.
Bezos had decided that the HQ2 process would be handled a little differently. Not only that Musk’s Nevada experience had gotten him fixated on achieving government subsidies, but also the fact that there was Boeing Co. involved. There was an $8.7 billion handout from Washington in 2013, to scale back its workforce over the next several years.
In January 2018, Amazon team members got an email that asked them to report to the office early. This was because the list of more than 200 HQ2 contenders had to be trimmed. Narrowing the list was quite time consuming, and a lot of effort went into maintaining the competitive frenzy that had taken priority over further narrowing down the list.
Amazon had really tried hard to keep the operation for internal consumption, however, the fallout had already spread to other departments as well. This ruckus had spread beyond North America that in a way led executives to split the new headquarters between New York and Virginia.
What Did The Employees Say?
Some Amazon employees had previously said that they shouldn’t have blindly assumed that Amazon would be welcome everywhere. However, they have seen signs of success in the 25,000 jobs that had come to Virginia and 5,000 in Nashville, Tennessee.
However, Jeff Bezos can take comfort in one aspect of the HQ2 saga. Probably this is because of the $762 million incentives from Virginia, as per the watchdog group Good Jobs First. Lastly, Amazon is only $100 million behind the $2.4 billion that Tesla has been accumulating in handouts.