Amazon set up its HQ2 bidding war for maximum manipulation of North America’s cities—and the company doesn’t seem to be following its own selection criteria closely.
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Our analysis found that shortlisted cities had more U.S. senators with considerable seniority. While this could simply be a coincidence, it is curious especially for a company that is frequently said to be a target of anti-trust inquiries and is currently the object of Trump’s ire.
At the end of the day, none of this should surprise us. Like all corporate site selection, the HQ2 process is a rigged game, where the company knows the answer in advance and sets up a fictitious competition to wrest maximum incentives.
Besides the political advantages, there are many signs that Amazon’s HQ2 is heading to the greater Washington, D.C. region—the fact that its CEO has a multi-million dollar mansion there (currently undergoing a $12 million renovation, with large public rooms for social events) and already owns the Washington Post; the fact that three area jurisdictions made the shortlist; and the fact that the person running Amazon’s search previously ran an economic development agency in the region. Perhaps four other metros on the list are serious contenders—New York, Boston, Chicago, and Toronto—with Philadelphia, Denver, Atlanta, and Dallas having an outside chance.
What’s going on is something that is actually bigger than just a search for a second headquarters; it’s about the company’s continued expansion across North America. Amazon is siting distribution facilities at a feverish pace, as my Atlantic colleague Alana Semuels reported back in February. Meanwhile, it is expanding its white-collar presence in cities like Vancouver and Boston.
The HQ2 process provides a way of crowd-sourcing information on sites, giving Amazon one of the largest and most comprehensive databases of urban-development data on the continent. If each of the submitting 238 cities handed over information on five to 10 sites, that gives Amazon a database of between 1,000 and 2,000 sites, as well as detailed information on specific types of talent, university and training programs, and of course, a bottom line of tax and financial incentives that the company can use as a bargaining chip for future projects.
The best way to read the HQ2 finalists is as a brilliantly cynical exercise in corporate locational strategy.
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