Faraday Future’s summer fling with Chinese real estate group Evergrande, which invested $800 million into the company last June, appears to be over. The “automaker” is allegedly trying to back out of its arrangement after its CEO and founder, Jia Yueting, requested an additional $700 million in funding. The official deal calls for another $1.2 billion over the next two years.
Faraday has a real knack for screwing over anyone who lends it any kind of financial help, and it looks like its biggest investor doesn’t want to get burned. As a result, the carmaker wants out and Jia has begun seeking arbitration to abandon the sale.
So far as we know, Evergrande stipulated that the company had to hand over its intellectual property and begin mass production of the FF91 before year’s end — otherwise Jia will be ousted as CEO. Officially, Faraday says it’s on track for December deliveries, but all we’ve actually seen are a few side panels being passed around by robots and one completed shell. Meanwhile, the manufacturer’s only completed pre-production prototype was reported to have caught fire last month, following an event where it was shown to employees and their families.
Pardon my editorializing, but Faraday Future has to be either the world’s worst automaker or its most elaborate scam. Its entire history is riddled with broken promises, squandered funds, and relentless failure. Last year, I called the company a masterpiece of non-fulfillment. I’m starting to think I was overly generous.
Following its mysterious and semi-shady arrival in 2014, Faraday has managed to showcase a car that failed to work as promised in front of a crowd at CES, betray the trust of an entire state, neglect the payment of numerous contractors, have its primary financial backer and CEO declare bankruptcy and flee his home country due to unpaid debs, lose a large portion of its workforce, and repeatedly push back production deadlines on a car that doesn’t even exist.
It would take ages to recap its complete, pathetic history. But we wanted to give you a quick refresher on its past before we checked back in on the present — which you’ll be shocked to learn isn’t looking too good.
According to Reuters, Evergrande officials claim Jia blew through the $800 million and asked for another $700 million to ensure production of the FF91. However, Jia says the real estate giant agreed to make two payments, and he’s only trying to get what’s been promised before the end-of-year production deadline rolls around. There are also reports that some of the company’s vendors have stopped receiving payments, which is a familiar story with Faraday.
A filing with the Hong Kong Stock Exchange from Evergrande alleges that Jia essentially lied to its board to procure funding and has withdrawn from the business arrangement he made with them. The firm says it will take “all necessary action” to protect itself and its shareholders. We’d recommend constructing a time machine and sending someone back to stop the deal from ever being made.
Still, proving that Faraday abandoned its goal of building electric vehicles before 2019 will be difficult. Progress, thus far, has been abysmal, but sources hint it’s because all of the money went into retooling Faraday’s factory in Hanford, California, of which it has temporary occupancy. This is supposedly why some suppliers are still owed payments (some of which are said to be over $1 million) and why Jia asked for the $700 million.
Besides, the factory is still operational and Jia doesn’t appear to have skipped town holding a satchel of cash. He was present for the company’s “Futurist Day,” where the prototype FF91 caught fire. According to The Verge, employees signed non-disclosure agreements specifically related to the fire, so we don’t know exactly what happened.
Any attempts to piece this giant puzzle together requires a lot of speculation. Did Evergrande get cold feet after seeing how quickly Faraday could burn through funds, or is Jia simply trying to protect the company’s long-term aspirations and his role as CEO? Was the $700 million advance paid or not? How is it that Faraday still owes money to vendors it should have paid back in 2016? Who is supplying this 130-kWh battery and ultra-powerful motor the FF91 is supposed to contain? Are there even confirmed specs for the vehicle?
If you’re hoping any of those answers will reveal themselves before 2019, I’m guessing you’ll be disappointed. Based on Faraday’s current progress, or lack thereof, I’m willing to bet the company fails to deliver a single model in December. That’s not to say it’s impossible, just that it makes sense to play the odds.
[Image: Faraday Future]