Why I think Amazon will choose Toronto for HQ2
Preface: I'm not advocating or hoping for this outcome. I simply think it is the logical one, and the one which Amazon will choose. But, my level of confidence on this matter isn't high as I don't really know what exactly is driving Amazon to even consider this move. But, here is why I think Toronto will win.
Firstly, I'm a little shocked about Vancouver being dropped from the short list. But, perhaps the proximity to Seattle is the crux of that one. It could be convenient. But, it limits their reach. It is really the only reason I can think of. Vancouver has basically supplanted Toronto in most other aspects. It is drawing in a lot of the new businesses and talent. It is one of the reasons that the housing is so expensive there. Perhaps because it is still in a boom phase it was deemed to costly. Honestly, I don't know how construction contract costs vary between Vancouver and Toronto. But, enough of that.
The timing, in my opinion, very closely coincided with the Trump election. And it is entirely possible that this is purely coincidental. It is also very possible that it wasn't. But, Trump has been very hostile on immigration and especially on the sorts of visas which tech companies rely upon. It could also have been a happy coincidence though. It highlights that a chance in administration creates volatility and uncertainty. Choosing another state would provide more options, but would still leave Amazon's new HQ subject to the same sorts of federal pressures it sees in Seattle.
By opening a second HQ in an adjacent country, they can hedge their bets easier. If they can't attract the talent they need to Seattle either due to the countries image or blocks due to government policies, they may be able to attract that talent to Canada instead.
Geographically speaking, Toronto is also most of the way to other side of the continent. It is still close to the US border. The temperature is generally warmer than much of Ontario (and Canada for that matter). And it is a huge metropolitan area with lots of infrastructure and appeal. There are certainly reasons why someone might want to choose Toronto over Seattle when they may have hard time choosing between Vancouver and Seattle.
It also means boosting employment resources in another popular time zone. The differences between Pacific and Eastern time are quite pronounced at the beginning and end of the day.
Primarily however, I think the biggest appeal of a Canadian city as the second head quarters remains the addition of a buffer from the effects of US politics.
I said I wasn't super confident though. And I will point out a few reasons. There are 19 US cities in that short list of 20. There will obviously be tremendous pressure to choose a "local" destination over a "foreign" one. There could be government related impacts from trying to move more business out of the country. And there could of course be a backlash at home over it. If there were more international cities in the running, it would make the odds and the perception of choosing an international destination less negative. Though, it would also weaken the case for Toronto specifically.
But, the question remains; if the pressure to keep HQ2 in America is too powerful. Why even put Toronto on the list?
Basically, my odds are not like "there is a 50% chance of it being Toronto". It is more like a 10% chance with the other 90 split up evenly amongst the other cities. So, while I think the odds are in the favor of Toronto, it isn't a runaway lead by any means.
Firstly, I'm a little shocked about Vancouver being dropped from the short list. But, perhaps the proximity to Seattle is the crux of that one. It could be convenient. But, it limits their reach. It is really the only reason I can think of. Vancouver has basically supplanted Toronto in most other aspects. It is drawing in a lot of the new businesses and talent. It is one of the reasons that the housing is so expensive there. Perhaps because it is still in a boom phase it was deemed to costly. Honestly, I don't know how construction contract costs vary between Vancouver and Toronto. But, enough of that.
The timing, in my opinion, very closely coincided with the Trump election. And it is entirely possible that this is purely coincidental. It is also very possible that it wasn't. But, Trump has been very hostile on immigration and especially on the sorts of visas which tech companies rely upon. It could also have been a happy coincidence though. It highlights that a chance in administration creates volatility and uncertainty. Choosing another state would provide more options, but would still leave Amazon's new HQ subject to the same sorts of federal pressures it sees in Seattle.
By opening a second HQ in an adjacent country, they can hedge their bets easier. If they can't attract the talent they need to Seattle either due to the countries image or blocks due to government policies, they may be able to attract that talent to Canada instead.
Geographically speaking, Toronto is also most of the way to other side of the continent. It is still close to the US border. The temperature is generally warmer than much of Ontario (and Canada for that matter). And it is a huge metropolitan area with lots of infrastructure and appeal. There are certainly reasons why someone might want to choose Toronto over Seattle when they may have hard time choosing between Vancouver and Seattle.
It also means boosting employment resources in another popular time zone. The differences between Pacific and Eastern time are quite pronounced at the beginning and end of the day.
Primarily however, I think the biggest appeal of a Canadian city as the second head quarters remains the addition of a buffer from the effects of US politics.
I said I wasn't super confident though. And I will point out a few reasons. There are 19 US cities in that short list of 20. There will obviously be tremendous pressure to choose a "local" destination over a "foreign" one. There could be government related impacts from trying to move more business out of the country. And there could of course be a backlash at home over it. If there were more international cities in the running, it would make the odds and the perception of choosing an international destination less negative. Though, it would also weaken the case for Toronto specifically.
But, the question remains; if the pressure to keep HQ2 in America is too powerful. Why even put Toronto on the list?
Basically, my odds are not like "there is a 50% chance of it being Toronto". It is more like a 10% chance with the other 90 split up evenly amongst the other cities. So, while I think the odds are in the favor of Toronto, it isn't a runaway lead by any means.
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