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Amazon has canceled its NYC headquarters plans in a stunning defeat

The $800 billion tech giant will now build only one new corporate campus, located in Northern Virginia.

Protestors unfurl an anti-Amazon banner that reads “Amazon delivers lies” from the balcony of a hearing room during a New York City Council Finance Committee hearing at New York City Hall.
Protestors unfurl an anti-Amazon banner from the balcony of a hearing room during a New York City Council Finance Committee hearing titled “Amazon HQ2 Stage 2: Does the Amazon Deal Deliver for New York City Residents?” at New York City Hall.
Drew Angerer/Getty Images
Jason Del Rey has been a business journalist for 15 years and has covered Amazon, Walmart, and the e-commerce industry for the last decade. He was a senior correspondent at Vox.

Faced with mounting opposition from New York politicians, activists, and labor unions, Amazon on Thursday, February 14, abruptly announced it was scrapping its plan to build a new headquarters in the Long Island City section of Queens, New York.

In what is a startling and rare defeat for the $800 billion tech giant, the company said in a statement that “a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.”

The absence of a mention of community-activist opposition was not an accident; that’s because the company expected some local pushback and felt it could work through it, according to a source. But Amazon was not as prepared for a huge wave of opposition from local politicians, and ultimately determined that its opponents didn’t want a compromise or constructive dialogue: They just wanted Amazon gone.

The local political opposition included New York City Council Speaker Corey Johnson, Councilman Jimmy Van Bramer, and Representative Alexandria Ocasio-Cortez (D-NY). New York State Senator Michael Gianaris, also an outspoken critic of the deal, was recently nominated for a seat on a state board that would vote on part of the $3 billion incentive and subsidy plan that Amazon was offered.

The appointment of Gianaris — which still needed to be approved by New York Governor Andrew Cuomo, who courted Amazon along with Mayor Bill de Blasio — was an important flashpoint on the path to Amazon’s ultimate decision, according to a source, but not the deciding factor.

It’s still unclear whether Amazon made any effort to negotiate a lower incentives package or had privately offered any unannounced benefits to the community that might have appeased some critics. But those opposed to Amazon’s plans did not only find fault with the tax breaks Amazon was due to receive. Some were outraged over what impact an influx of 25,000 new workers at an average salary of $150,000 would have on an already broken subway system and high-priced housing market. Others railed against the company for its long-held opposition to unionization among its workforce.

Where does Amazon send these jobs now? The company had announced in the fall that it had decided on two locations to split the 50,000 jobs it promised to create: one in Long Island City and another in Northern Virginia. Now, Amazon says it will continue with plans for a new corporate campus in Virginia that can hold up to 25,000 employees, but spread the remaining 25,000 jobs over its existing 17 offices and hubs throughout North America.

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