Jia Yueting's Faraday Future Loses Appeal for Investors
Qian Tongxin
DATE:  Nov 02 2017
/ SOURCE:  Yicai
Jia Yueting's Faraday Future Loses Appeal for Investors Jia Yueting's Faraday Future Loses Appeal for Investors

(Yicai Global) Nov. 2 -- "Progress has been slow at the plant, but we're trying to secure funding to spur the company to faster development," Nick Sampson, a senior vice president at Faraday Future (FF), told Yicai Global after the firm released a statement overnight on media reports of Jia Yueting's 'fleeing to the US'. But he did not mention any financing deals or timelines.

FF plans to kick off mass-production of its high-end electric vehicle (EV) model, FF 91, by the end of next year, but production has still not started at the Handord plant. The firm has made little headway on funding after more than six months of preparations.

"FF is really a credible project. Both the technology and design are very good, but funding is still not in place yet. It's a pity the competitors have all got a lot of money in funding," a former employee who left FF two months ago told Yicai Global.

Jia Yueting has lost the trust of Chinese investors, he added, "Everyone's asking him (to leave), but he doesn't think so and still sees himself as a superhero. But he might have some other plans."

The difficulties facing FF are sapping staff morale. Many people wanted to leave, but it is not easy to find a new job, so some of the senior managers decided to stay on, and there is nothing they can do, the former employee said. "Information is not transparent at FF at all. The managers are not honest with each other either, so it's impossible to know the true state of the company now."

Two senior managers, global supply chain vice president Tom Wessner and interior design and branding head Pontus Fonateus, left within a week last month. The tech startup has lost three of its five founders.

Jia has been working in the US ever since his resignation as president of Leshi Internet Information & Technology (Beijing) Co. [SHE:300104]. Almost all of his Weibo posts in the past several months were about electric car development. FF shelved the plan to build a USD1 billion factory in Nevada in July, claiming that it "has found a new site for the auto plant." The Chinese billionaire posted a video of the new upscale FF 91 plant about a month later on Aug. 16. The new plant was built on the site of an old Pirelli tire factory in Hanford, California. Netizens were disappointed to find that there was virtually nothing inside the plant.

"The first priority now is to achieve mass production as soon as possible. The quickest way to achieve this goal is to let our new plant in Hanford, California, start production, which is also part of our production plan, just as is the Nevada factory. Though smaller, that plant has existing production facilities and can prepare for mass production by the end of next year," Faraday Future wrote in a letter to Yicai Global in August.

More than 10 share offering review officials at China Securities Regulatory Commission (CSRC) were put under investigation after the authorities found falsified documents used for the initial public offering application of Leshi Internet Information and Technology in 2010, and the company might be delisted, the Caijing magazine reported on Oct. 31.

The market was not surprised by the news though. The finance channel of China Central Television (CCTV) reported in July that the provincial procuratorate of Jiangsu had prosecuted Li Liang, the then head of the CSRC's No. 1 IPO review officer, for abusing his official powers to facilitate Leshi's stock listing in 2010. Brokerages downgraded target prices for the company by 30 percent on the news, and its market capitalization slumped USD2.5 billion.

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Keywords:   Jia Yueting,FF,Leshi,Faraday,EV