The end of the year isn’t the end of the line for one electric vehicle startup. Problem-plagued Faraday Future has managed to avoid its demise for the time being thanks to a $1 billion cash influx. According to new reports, the controversial Chinese investor, Jia Yueting, told company employees at a December 13 meeting about the new funding round. It remains unclear where this money is coming from, however, and what the terms of such an investment really are.
Faraday Future, the would-be Tesla competitor, has had a number of problems, particularly related to its financials and production. Many of these issues appear to be related to Jia himself, who also announced on December 13 that he will step in as chief executive (a role no one has filled in four years). As CEO, Jia is slated to reorganize the structure of the firm to “ensure the implementation of corporate strategies,” per a report from Securities Daily.
Leadership aside, Faraday Future also appears to be having trouble meeting its timeline for producing cars (to be fair, Tesla suffers from a similar problem). During a December visit to the company’s factory, a Chinese journalist claimed to see only a security engineer on site, and no production equipment at all. As such, creating a mass-produced car by the end of 2018 appears to be something of a stretch. If you’re just catching up on the company, here’s everything you need to know about Faraday Future.
Then there’s the issue of Jia himself. The investor founded LeEco, the Chinese conglomerate with similar ambitions that has fallen upon similar difficult times. As a result, Jia appears to be very heavily in debt — so much so that China’s Securities Regulatory Commission has ordered him to return home. A letter explaining the Commission’s order notes that Leshi (a subsidiary of LeEco) has failed to repay debts and “has severely hurt the interest of the listed company and investors and has had an extremely adverse social impact.”
All that aside, Faraday Future seems to be in the clear for the time being. The $1 billion is already being used to pay debts, which currently stand at over $100 million. We’ll have to see if the company is able to deliver upon its promises come 2018.