After a lengthy silence, financially challenged EV maker Faraday Future issued a tweet reconfirming its commitment to build its FF 91 model, while warning if an infusion of cash doesn’t arrive soon that could change. The company noted a round of layoffs are on tap as well.
In mid-November, the company was assumed dead before some churn at the top of the company’s management structure lead to founder Nick Sampson departing the company and the new leadership team announcing the company would come back.
Today’s Twitter missive laid the blame for their current financial issues squarely at the feet of Chinese investment firm, Evergrande Health.
“FF’s recent financial crisis was brought about by investor Evergrande Health refusing to make its scheduled payments,” according to the statement. “The investor has further breached its contractual obligations to FF and refused to release its liens over FF’s assets as it was required to do.
(Faraday Future insists it isn’t going away. Click Here for the story.)
“This has resulted in making it more difficult for FF to achieve short-term financing through asset-backed loans resulting in the current temporary cash flow difficulties. This action has unequivocally harmed FF employees worldwide, our suppliers, our partners, and all of our reservation holders.”
The statement also notes that the company is applying financial relief from the U.S government to help it get back on its feet. However, that aid may not arrive until well into the first quarter of 2019.
Until that arrives, the company will furlough another round of employees this week. The number wasn’t revealed. However, the announcement also mentions it still has “hundreds” of employees pushing ahead with the production of the FF 91 — many of them working on minimum wage or salaries capped at $50,000.
Faraday is “effectively insolvent,” declares former co-founder. For more, Click Here.)
“This was an extremely tough decision to make, and we recognize the emotional stress and financial strain this puts on people’s personal lives,” the announcement notes. “In addition, we take our relationships with our suppliers seriously, and we hope to receive support and understanding from our global partners as FF overcomes our difficulties.”
The company is still trying to pull in interest from new investors; however, Evergrande placed liens on equipment in the plant in Hanford, California, making it impossible for Faraday to use them a collateral for loans from other potential investors.
Faraday’s existence stands in stark contrast to other battery-electric companies, such as Byton, Bollinger, Tesla and, most recently, Rivian. These companies have enjoyed various levels of success or hit important milestones this year.
(Faraday fritters away funding. Click Here for our earlier report.)
Tesla finally turned a quarterly profit during the third quarter and expects to be profitable going forward. Byton debuted a new vehicle during the L.A. Auto Show, while Rivian offered up a new truck and sport-utility vehicle.