Faraday Future Cites Arbitration 'Victory' Amid Layoffs
The startup declared a win in the arbitration against China's Evergrande Healthy Investment Group.
Electric-car startup Faraday Future claims to have won a "decisive victory" in arbitration against China's Evergrande Healthy Investment Group, its onetime biggest investor. Without Evergrande's money, Faraday has resorted to layoffs and salary cuts to stay afloat. But the automaker claims the arbitration win now allows it to seek funding from other sources.
Evergrande's investment at first appeared to be a financial lifesaver for Faraday, which has struggled to get its FF 91 electric SUV into production. But after Evergrande refused to release an advance on its next scheduled payment, Faraday initiated arbitration proceedings against the firm in Hong Kong. The arbitration decision paves the way for Faraday to terminate its agreement with Evergrande, the automaker, which refers to itself as FF, said in a statement.
"Today's ruling definitively enables FF to accept new funding from investors around the world, and we welcome all investors who share our vision," the automaker said.
But the layoffs and salary cuts initiated to keep Faraday afloat after Evergrande withheld payments still remain in effect. Faraday previously said most remaining employees would see their salaries cut by 20 percent, with some executives volunteering to take higher cuts. However, The Verge reports that some employees were let go without severance, and had the 20 percent salary cut applied to their last checks.
Nonetheless, Faraday still claims to be on track to delivering the first production FF 91s to reservation holders. The first pre-production FF 91 was completed at Faraday's Hanford, California, factory Aug. 28. Faraday claims it will begin deliveries of customer cars in 2019.