Faraday Future Has Unpaid Bills, Faces Possible Work Stoppage At Nevada Factory

Faraday Future

OCT 23 2016 BY MARK KANE 16

A strange development on the manufacture of Faraday Future’s $1 billion investment into an electric car factory in Nevada, and right after the recent announcement that AECOM was contracted for the job.

According to Automotive News, there are already unpaid bills for construction work, which threaten work stoppage and undermine Faraday’s financial credibility.

Tom Wessner, VP of Global Supply Chain at Faraday Future (FF), left, Ding Lei, Co-founder, Global Vice Chairman at SEE Plan at LeEco, second, Nevada Gov. Brian Sandoval second right, and Dag Reckhorn, VP of Global Manufacturing at FF turn shovels at Faraday Future's Ground Breaking Ceremony on Wednesday, April 13, 2016, in North Las Vegas.(Bizuayehu Tesfaye/AP Images for Faraday Future)

Tom Wessner, VP of Global Supply Chain at Faraday Future (FF), left, Ding Lei, Co-founder, Global Vice Chairman at SEE Plan at LeEco, second, Nevada Gov. Brian Sandoval second right, and Dag Reckhorn, VP of Global Manufacturing at FF turn shovels at Faraday Future’s Ground Breaking Ceremony on Wednesday, April 13, 2016, in North Las Vegas.(Bizuayehu Tesfaye/AP Images for Faraday Future)

“In an Oct. 10 letter, Robert Gay, vice president and project executive at AECOM — which is overseeing $500 million of work on the roughly $1 billion, 3 million-square-foot plant — cites an unpaid $21 million deposit, due in September, to an escrow account to cover material costs and subcontractor work.”

The letter details further conditions, and gives Faraday 10 days to “fully fund” the escrow account, or face a work stoppable until the “funding issue is resolved.”

Automotive News reached out to both FF and AECOM and curiously got a joint statement response that “reaffirm(ed) their commitment to working together” so perhaps the fire has been extinguished to some degree.

““The business relationship between Faraday Future and AECOM is strong and we remain committed to building our factory of the future in North Las Vegas,” the statement read. A Faraday spokesman said that no work stoppage would take place and that the automaker was working diligently with AECOM to resolve the overdue payment.”

We do note that the statement doesn’t actually note the bill has been paid, but has that “oops, we didn’t pay you those millions? It must have got lost in the system; the cheque is in the mail”-type feel to it.

Faraday Future will be unveiling its long awaited production vehicle this January at CES, so we don’t imagine more news questioning the financial viability of the company is the type of press the company is looking for at the moment.

source: Automotive News

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16 Comments on "Faraday Future Has Unpaid Bills, Faces Possible Work Stoppage At Nevada Factory"

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Pai Gow

While it would not at all surprise me if Faraday Future is running out of money, considering how many high-profile executives they’ve hired, most of them apparently as a publicity ploy — how many executives do you really need to oversee building a prototype, anyway? — at the same time, I think some caution is in order. I remember seeing a similar article about Tesla Motors, and not that many years ago. Of course with Tesla, it was only a temporary situation with some unpaid bills.

If Faraday Future really is out of money, I’m sure we’ll see more reports along this line before long.

Also remember that Tesla had a CEO who was ready to pay the bills out of his pocket. Not many companies will be so blessed.

Tesla bought their factory for a bargain from Toyota, that preserved capital.

Color me skeptical (still). I thought the groundbreaking last spring was bogus, and it was, with two tiny bobcats driving around on an empty lot, stirring up dust. Now I am to believe an unproven company with no tangible product yet is about to build a $1B factory? Maybe they could rename the company Theranos.

To be fair it was more like half a dozen, but I agree with your point. I have cast derision upon FF with alacrity and persistence and will continue to do so.
“Bobcats in the Desert.”
http://insideevs.com/faraday-future/

Faraday is busier than a bee here in Gardena, Ca. Must be a Chinese State dibursment issue. A lot of liquid assets are under scrutiny leaving the Chinese Mainland, as of late. This will get sorted out in short order.

Sure, while it’s destroying FF’s reputation with builders and suppliers…

I advise anyone with business dealings with FF to cut and run while they still can.

Simply the life of a statup…
Tesla almost went under a couple of times…
Hopefuly they make it to production which I think they will through my bigger question is will there car sell once produced…

This sounds about as good as those compression/hvac systems that SVEN has been unearthing – sounds great until you get into the details – I clicked on the ‘products’ part of their website and it just said ’email or call us’.

Same here: One Billion dollar car manufacturing is ‘right around the corner’, but they have the mundane problem about being unable to pay any of their bills.

Maybe the general contractor can take their role little more serious and pay their subs Instead of holding the money and playing the stupid freaking corporate game.

Better step it up otherwise they can call themselves,,, Faraway Future !!

Maybe they went to the Trump School of Business. They already have the 1 billion write off and Chap 11 paperwork is printing as speak to legally get around paying all those pesky workers.

+1?

Don’t blame me for cheating people out of the money they deserve, blame the law makers who made such favorable, to business, laws
–“The Donald.”

Of course he declines to mention the link in the chain that describes the loads of cash used to buy politicians, it’s called lobbying, legal bribery, which people like him paid to legislatures to get such laws passed in the first place.
He’s a Flim-Flam Man selling ‘Trump Tonic,’ to a gullible public.

They aren’t liable personally anyway. It’s the corp. that goes bankrupt and the investors are the ones losing money.

They just stop getting their huge salaries that they have drawn out of the investors’ pool.

Sounds a lot like the Atlantic City casino shell game.