Faraday Future Says Its First Car Will Go Into Production Next Summer In the Central Valley
After a string of funding problems that have delayed the release of its first car, Faraday Future announced Tuesday that production would start by July 2022 at an assembly plant in Central California.
Irvine-based architecture firm Ware Malcomb is set to finalize the building's design and engineering for an automobile plant in Hanford, California. Faraday says the 1.1-million square-foot building can produce 10,000 vehicles per year when it's up and running.
Faraday Future, which announced a $3.4 billion SPAC merger in January with Property Solutions Acquisition Corp (PSAC), said last March a $100 million debt financing would allow it to begin production on the FF91 electric vehicle in Hanford. Until now, it hasn't delivered on its production promises for the consistently delayed luxury EV.
"FF has already completed significant investment at our Hanford manufacturing facility, and with the additional funding from our merger with PSAC, we anticipate that the plant will be up and running in the near future," CEO Carsten Breitfeld said in the announcement.
Faraday Future's Facility in Hanford, California
The luxury FF91 SUV is set to compete with vehicles like the Tesla Model X. Faraday promised the FF91 would go from 0-60 mph in 2.4 seconds, while it featured a tech-heavy interior. Customers were asked to put down $5,000 for a refundable deposit for the car that most recently was supposed to begin production at the end of 2020.
The Gardena-based startup will also work with Tesla manufacturing partner Myoung Shin to make more vehicles in South Korea, including models other than its 1,050-horsepower debut electric car. Faraday said it secured a former General Motors plant there for additional production capacity, although it didn't specify on production capacity.
The company was founded in 2014 and showed a high-performance electric supercar at the 2016 Consumer Electronics Show in Las Vegas. But the following year, it unveiled the more mainstream FF91.
It leased the Hanford facility in 2017 after canceling plans to build a $1 billion plant near Las Vegas, even though construction had already started. But money problems had beset Faraday Future since 2016 and continued to delay the start of production for the FF91 and other models were dropped from its plans. The company furloughed hundreds of workers in 2018 and sold its Gardena headquarters in 2019 to raise cash.
Its co-founder and former CEO, Jia Yueting, was also caught in a financial scandal. His assets in China were frozen and he moved to California permanently, where he spent millions on homes and other purchases. Jia filed Chapter 11 bankruptcy in the United States in 2019.
The controversy with Jia also resulted in then-chief technology officer Ulrich Kranz and chief financial officer Stefan Krause to leave the company. Kranz and Krause later founded Torrance-based Canoo Inc. (Kranz recently left Canoo for Apple).
Faraday Future didn't elaborate on how many additional vehicles it hopes to produce in South Korea or how many additional markets it plans to enter, but the company said it's brought on key people to ramp-up assembly. In March, the company hired a former Jaguar Land Rover executive to establish operations in China.
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Faraday Future named former Jaguar Land Rover executive Xuefeng "Chris" Chen as the chief executive of its China division as the company prepares to enter the world's largest electric vehicle market and develop its binational market strategy.
With a new Chinese investor, Faraday is focused on developing its market in China, which is over triple the size of the U.S. market, according to a 2019 report by the International Energy Agency.
"Chris is a critical hire to the realization of FF's US-China dual home strategy," said Global Faraday Future CEO Carsten Breitfeld in a statement announcing the appointment. "I am confident that his comprehensive management acumen and operational experience in luxury car brands will accelerate the implementation of FF's business in China and will be beneficial to FF's global strategic development."
Prior to joining Faraday, Chen served as the executive vice president of Chery Jaguar Land Rover Automotive. He had been promoted from executive vice president of manufacturing, becoming the youngest executive running China-side business in an automotive joint venture.
The Los Angeles startup is expected to go public by midyear in a deal that values it at $3.4 billion. Its anchor investor is Hangzhou, China-based Geely Holding Group, an automotive manufacturing company that has plans to spend almost $5 billion to build an electric battery plant in China, Reuters reported earlier this week.
Faraday will use Geely's manufacturing services and technology and engineering support to develop its base in China.
Faraday is also preparing to roll out its flagship product one year after going public. The FF 91 is an all-electric, autonomous ready luxury vehicle that boasts more than 300 miles per charge and a 1050 horsepower.
It's expected to go into production later this year.
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Faraday Future Strikes a Deal with China's Top Auto Group as It Readies for a Wall Street Debut
A day after luxury electric carmaker Faraday Future said it will go public, it announced a new partnership with China's largest privately-owned automotive group that could help it produce cars in China.
Gardena-based Faraday Future said Thursday it will merge with a special purpose acquisition corporation, or SPAC, Property Solutions Acquisition Corp., a deal which will value the combined company at around $3.4 billion and will raise about $1 billion, the company said in its announcement.
On Friday, the automaker made public that it had signed a cooperation agreement with Zhejiang Geely Holding Group, one of its minority investors. The companies will explore the possibility of using production services provided by a joint venture between Geely and Foxconn, a Taiwanese electronics contract manufacturer. Geely will also provide technology and engineering support to Faraday.
Bill Russo, founder and CEO of Shanghai-based Automobility, said Geely, which owns Volvo, has recently made several investments to build a portfolio around a new mobility-related platform.
"This is a full range transportation equipment ecosystem that Geely is building and Faraday completes part of the puzzle," Russo said.
Neither company provided more specifics about the partnership, but Reuters reported that Faraday plans to set up a new base in China. In a statement, Geely said new details will be "announced at a later date."
Faraday Future becomes the latest company in a wave of electric vehicle makers to go public through a merger with a SPAC, including Canoo, Fisker, Lordstown Motors and Nikola.
The merger is expected to fully fund the production of Faraday's luxury electric vehicle, the FF 91, within a year of the close of the transaction and will help the company finish construction of its factory in Hanford, California. No vehicles have been produced so far.
"This is an important milestone in our company's transformation,," Faraday Future Global CEO Carsten Breitfeld said in announcing the SPAC. "I am excited that this business combination will allow us to launch the class defining FF 91, building upon the founder's original vision to help our users and shareholders take part in shaping the future of mobility."
About $230 million of the proceeds from the merger is expected to come from the money raised by Property Solutions in its SPAC. The remaining $775 million will come from a private placement in public equity, or PIPE, investment.
After the merger is complete, it will be listed on the Nasdaq Stock Market under the ticker symbol "FFIE."
Analysts say the demand for electric vehicles will continue to grow as regulators crack down on emissions. The Biden administration has pledged to help develop an electric vehicle charging infrastructure as part of a jobs proposal for the automotive industry. Biden also said this week he wants to replace the government's fleet of 650,000 vehicles with electric models. And in California, Gov. Gavin Newsom ordered all new cars and passenger trucks sold in California be zero-emission by 2035.
General Motors said Thursday it will stop production of gasoline-powered cars, trucks and SUVs by 2035 and shift its entire new fleet to zero-emission vehicles.
Faraday has faced some financial challenges since it launched in 2014 with a stated ambition to overtake Tesla.
Chinese technology mogul Jia Yueting, who founded the company, filed for Chapter 11 bankruptcy in 2019, which was completed in July.
Yueting stepped down from his role as CEO is now serving as the chief product and ecosystem officer at the company.
Breitfeld is a former BMW executive who took the helm in 2019.
Faraday expects to sell more than 400,000 vehicles over the next five years, saying its FF 91 has received 14,000 reservations.