Faraday Future Secures $1.5 Billion Financial Lifeline, Report Says
Faraday still hopes to get the electric FF 91 into production by the end of the year.
Faraday Future's future hasn't looked very good for the past few months, but the electric-car startup is eager to turn things around. Faraday has secured a $1.5 billion investment from an unnamed Hong Kong party, according to Business Insider, and hopes to get its FF 91 electric SUV into production by the end of this year.
Faraday already has $550 million of this windfall "in the bank," Business Insider said, citing an anonymous source familiar with the matter. It received about $300 million in December, and $250 million earlier this month. The remaining $950 million is contingent on certain project milestones.
This could be an important break for Faraday. The automaker relied on Chinese entrepreneur Jia Yueting and his LeEco tech company for funding, but when LeEco encountered financial troubles, Faraday's funds began to dry up. Jia said he had secured $1 billion for Faraday in December, the same month he took over as CEO of the automaker. It's unclear if this is the same deal reported by Business Insider, or a new arrangement.
Faraday held its first supplier summit Feb. 13 and confirmed that it plans to start FF 91 production by the end of this year. The FF 91 was unveiled at CES 2017, but production plans quickly stalled. Faraday originally planned to build the SUV at a brand-new factory in North Las Vegas, Nevada, but work on the factory quickly stalled. The company eventually abandoned the Nevada factory site, opting to convert a Pirelli tire plant in Hanford, California, into a smaller, cheaper factory.
"As of Feb. 1, the property has been completely vacated, so we will move forward on construction and equipment by the end of the quarter," Dag Reckhorn, Faraday's senior vice president of global manufacturing, said at the supplier summit. "We remain on an aggressive, yet workable timeline of year-end delivery for FF 91."
Setting up a factory and starting production in less than a year is a tall order. But Faraday has still found time to sue Evelozcity, an electric-car startup founded by one of its former executives. Echoing the recently-settled Uber-Waymo lawsuit, Faraday alleges that former CFO Stefan Krause stole trade secrets to use at Evelozcity, which denies those accusations.