Toyota announced Monday it is moving its North American headquarters from Torrance, Calif. to Plano, Texas.
The official announcement came immediately following a company webcast Monday morning, when employees were notified of the company's decision to consolidate its operations in Michigan, Kentucky and California into a single facility in Plano.
In a statement, Toyota described the move as one "designed to better serve customers and position Toyota for sustainable, long term growth."
Torrance city officials confirmed the move would impact approximately 4,000 Torrance-based Toyota employees, including 2,000 in motor sales, about 1,000 in the company's financial sector and 1,000 in manufacturing.
The move is not expected to take place until the facility in Plano is complete sometime in 2017, according to Toyota officials.
The company is offering its employees relocation packages as well as an "exploratory trip" to Plano for employees and their spouses to help them make what is bound to be a very tough decision, sources told NBC4.
"It's scary for a lot of folks, I'm sure if you're an older person not quite ready to retire," said one Toyota employee who did not want to be identified. "It could be a pretty scary situation."
Torrance Mayor Frank Scotto said Toyota officials contacted him last week to ask if he would be available to talk Monday morning. Scotto said he had a feeling it involved a change at Toyota, but he said he did not anticipate the entire headquarters leaving.
"I did know something was happening, but I didn't thoroughly understand it was to this magnitude, which is a true disappointment to me," Scotto said Monday.
Texas Gov. Rick Perry released a statement following the announcement welcoming the move. The statement read in part, "in exchange for Toyota's commitment to create these new jobs and capital investment in Texas, the state has offered Toyota an investment of $40 million through the Texas Enterprise Fund (TEF)."
Despite what some have speculated as the reason for the move, Assemblyman Al Muratsuchi, D-Torrance explained the purpose behind it.
"Toyota representatives have personally informed me that this is strictly a business decision that has nothing to do with California's business climate," Muratsuchi said.
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Los Angeles County Supervisor Don Knabe, who represents the Fourth District, called the move "extremely disappointing and concerning" for the county.
"For years, we’ve seen businesses flee California’s high taxes and strict regulations for more business-friendly states like Texas. This mass exodus should have sent a message to our state leaders that something needs to change, and fast," Knabe said in a statement. "This is a textbook case and we need to do an 'exit interview' with Toyota to learn what we can, as a state, do better, so that we stop being a target for other states."
Toyota opened its Torrance headquarters in 1982, where about 5,200 employees work.
About 2,300 employees will remain in California in locations including Newport Beach and Long Beach, according to company and city officials.