Elon Musk

For now, SpaceX will be assembling and testing its Starship prototype in Texas rather than California.

CBS Los Angeles reports that the rocket company helmed by Elon Musk has canceled a lease with the Port of Los Angeles.

SpaceX was planning to build a new facility to construct its huge new vehicle designed to take people to the moon, Mars or even deeper into the solar system.

"To streamline operations, SpaceX is developing and will test the Starship test vehicle at our site in south Texas," reads an emailed statement from the company. "This decision does not impact our current manufacture, design, and launch operations in Hawthorne and Vandenberg Air Force Base in California. Additionally, SpaceX will continue recovery operations of our reusable Falcon rockets and Dragon spacecraft at the Port of Los Angeles."

SpaceX and Musk have recently been showing off the development of the Starship "hopper" prototype in Texas that is set to begin short test flights this year. Musk explained via Twitter that the prototypes are being built in Texas where SpaceX has a launch site because "their size makes them very difficult to transport."

The lease with the Port of Los Angeles would have allowed SpaceX to build a manufacturing facility on a 19-acre parcel on the historic Terminal Island. The plan was for the huge assembled rockets to be then transported via barge and the Panama Canal to Cape Canaveral in Florida.

Los Angeles city councilman Joe Buscaino tweeted that he was "crushed" Musk's company will no longer be expanding its presence at the port.

The streamlining move also comes shortly after the company, based in the Los Angeles area, announced it would be laying off about 10 percent of its employees to "become a leaner company."