Faraday Future free to seek funding beyond Evergrande, arbitrator says
The company recently made some deep cuts, which it attributed to Evergrande's stranglehold on its finances.
Andrew KrokReviews Editor / Cars
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Faraday Future's employees might not have to live under the company's recently implemented austerity measures for much longer.
The arbitrator overseeing the conflict resolution between Faraday Future and its primary investor, Evergrande Health, has determined that Faraday Future is allowed to seek out additional funding independent of Evergrande.
The news comes as part of a statement posted to Faraday Future's Twitter account. "As the largest shareholder of FF, Evergrande has intervened on the Company's capital planning, as well as preventing FF from utilizing its assets," the statement reads. "The investor also made short-term financial relief impossible by preventing the Company from obtaining other external investments."
The Faraday Future-Evergrande brouhaha has been ramping up in recent weeks. In June, Evergrande Health assumed another company's commitment to fund Faraday to the tune of $2 billion dollars. The initial investment of $800 million came, which Faraday said it burned all the way through, and the fledgling automaker asked its primary stakeholder for another $700 million to continue meeting its financial obligations. Evergrande apparently declined, but it reportedly wouldn't let Faraday find money in other ways, and Faraday subsequently took Evergrande to arbitration over it.
"Evergrande has taken unreasonable actions including pushing FF into a 'cash crunch' with the attempt to gain control and ownership over FF and all of FF's [intellectual property] globally," the statement reads. Evergrande did not immediately return a request for comment.
That "cash crunch" led to some real-world ramifications. On Monday, Faraday announced that it was laying off some staff and reducing everybody else's salaries or hourly wages by 20 percent until it has the liquidity it needs to continue functioning. The CEO and several members of the executive team are reportedly taking $1 salaries, too. It's unclear how long the austerity will last, but hopefully, being able to find new investors will allow FF to get over that hump quickly.
Faraday Future plans to start mass deliveries of its six-figure electric car in 2019, although it will likely try to get at least one delivery on the books in 2018 to live up to prior promises. With more than 1,000 horsepower reportedly on tap, the FF91 will reportedly reach 60 mph in less than 2.5 seconds. FF has made some mention of autonomy in the past, but it's unclear what sort of driver-assistance systems will be available when the car launches.
Holy crap, Faraday Future finally unveiled its first electric car!