According to reports, Faraday Future, the electric-car startup that was once hyped as a "Tesla-killer," is now hardly a challenge to Tesla's growing success.
Faraday Future In Trouble
Company executives and Faraday's most important investor, Chinese billionaire Jia Yueting, gathered early this month at the annual mega-showcase for the technology, electronics, and auto industry, the International Consumer Electronics Show in Las Vegas. This was a chance for Los Angeles-based Faraday Future to prove the potential of the company.
According to Mashable, the startup automaker unveiled the FF 91 at the show. But a report published by Business Insider pointed out that Faraday Future's presence at the show was meant to distract from the company's impending implosion. Representatives for partner/backer LeEco, the Chinese electronics company, and Faraday Future called the report "speculation" without giving further comments.
The Nature Of Company's Troubles
The report claims that eight Faraday Future executives said that the company faces mounting debts, a shortage of cash and is being abandoned by executive-level employees. It appears that many of Faraday's issues are due to disconnect between US-based executives and Chinese investor Jia Yueting's LeEco team.
Faraday's financial and executive issues were also reported previously by Fortune. However, after the FF 91 debut, the scope of the company's problems is unexpected.
Now, it seems that the only chance for the company to stay afloat depends on the market success of the FF 91 car. But the problem is that the upcoming car model won't ship until 2018 and it's uncertain if the company will be able to survive until then. Faraday Future could actually be forced into bankruptcy by its suppliers if the company cannot find a way to get money out of China in the next 60 days.
Despite the serious challenges faced by the company, its FF 91 made a good impression at CES. Faraday Future also announced that the car received over 64,000 preorders following the show.