Tesla CEO Elon Musk has said the all-electric automaker will establish its engineering headquarters in Palo Alto, California.

California Governor Gavin Newsom joined the eccentric billionaire at the former Hewlett Packard HQ, and the two men announced that the automaker's engineering division will set up shop at the building. Musk is said to be excited about the new development.

In 2021, the automaker was quickly moved to Texas following years of tension between Musk and California state officials. The CEO even elected to move to the Lone Star state in his own personal capacity.

Despite this, Tesla's footprint in California remains sizeable, thanks to the Fremont factory. This facility built its two-millionth car last year, a red Model 3 Performance.

"The thing that warms my heart, and I think is pretty incredible, is that this is Hewlett Packard's original headquarters. This is where [the company] was created, and it's really the foundation of Silicon Valley. We're inheriting an incredible legacy here," said Musk at another conference.

Governor Newsom, who is also fighting the scourge of catalytic converter theft, is delighted that Tesla has chosen the state for the location of its Global Engineering Headquarters. "It's a point of pride - always has been - that Tesla is a California company, started right here," he said. Interestingly, Newsom was one of the first people to purchase an original Tesla Roadster, added Musk.

The automaker remains an immensely popular choice for California residents and recently came very close to eclipsing Toyota as the best-selling automotive brand in the Golden State.

"Let's see this as the beginning of something even more extraordinary on the journey to dominate in this space and to change the way we produce and consume energy in this state, this nation, and the world we're trying to build," added Newsom.

Whether this reignited love affair lasts remains to be seen, especially as California recently said Tesla is banned from using the Full Self-Driving name in California. Legislators deemed the name misleading and said it could lead to potentially dangerous situations. Newsom signed the Senate bill late last year, and the legislation officially came into effect this year.

Musk is optimistic about this new chapter in Tesla's future. "We're looking forward to an exciting partnership with California to ... transition the world to sustainable energy as quickly as possible."