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The latest twist in history is a statement from Evergrande Health (see here) that claims that Jia Yueting manipulated his council's head office in the joint venture to begin arbitration against his biggest investor, Evergrande Health. Evergrande saved Faraday Future by taking over the bonds and ownership of Season Smart Limited, which invested $ 800 million in Faraday Future on 25th May 2018 in exchange for a 45% stake. Evergrande Health is also committed to investing an additional $ 600 million by the end of 2019 and an additional $ 600 million by the end of 2020.
Out of 25th In July, Jia Yueting informed his investor that the $ 800 million had already been exhausted and asked him to postpone his investment of 2019 and a portion of its investments from 2020 to 2018. Evergrande Health agreed to move forward 700 million additional dollars under certain undisclosed conditions. However, it appears that these conditions were not met (according to Evergrande) and that they did not pay the $ 700 million, Jia Yueting was forced to force the company to do so by arbitration and to deprive it of its shareholder rights.
Regardless of the arbitration, this dispute raises very serious questions about Faraday Future and its management:
First 800 million dollars. The deal was signed between Faraday Future and Season Smart on September 30th.th November 2017 and presumably a strong financial plan was in place. This would have matched the investment tranche schedule, which means that the $ 800 million was to last all of 2018. However, just 58% of the total until 2018, Faraday Future is already running out of money. money and ask for all the money for 2019 and part of 2020 too. This strongly suggests that Faraday Future's fiscal discipline and financial management are totally disordered, as it appears that the spending plan has been overtaken. This, combined with the fact that Faraday Future is still struggling with a dispute with his previous CFO, who has a good track record (see here), adds to concerns about Faraday's financial management.
Secondly, suppliers: Once again, Faraday seems unable to pay its suppliers. The group that helped Faraday Future launch the FF91 at CES in 2017 has still not been paid and has taken legal action this summer (see here). In addition, The Verge (see here) claims to have recruited more suppliers who were not paid for the work they did or for the equipment they provided. This raises further questions about what happened to the $ 800 million spent by Faraday Future between the 25th May 2018 and July 30, 2018.
Third, the product: Once again, according to The Verge (see here), the first and only prototype of FF91 caught fire after being shown to employees and their families. Through non-disclosure agreements, the extent of the fire is not known, but that may not be a good sign, as mass production is expected to begin in Q4 18 This incident can not be corroborated elsewhere and the sources are not named, which makes it difficult to give any weight to this supposed fire. However, this still raises other issues that Faraday Future has not given any answer to.
This arbitration raises even more problems with regard to the strength of Faraday Future, which certainly has money problems and can also present serious defects with its product. The red flags combined with the history of the company and the current leadership do not allow me to believe that the FF91 will ever see the light of day.
In addition, the last thing to do when one is saved is to fight against his benefactor, which leads me to question the ability of Jia Yueting to run this business (see here).
Clearly, Faraday Future's best chances of success will be achieved with a brand new leadership totally disconnected from its chaotic past. Byton, who has also amassed a similar amount this year and looks good on it, is a much better bet.
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The latest twist in history is a statement from Evergrande Health (see here) that claims that Jia Yueting manipulated his council's head office in the joint venture to begin arbitration against his biggest investor, Evergrande Health. Evergrande saved Faraday Future by taking over the bonds and ownership of Season Smart Limited, which invested $ 800 million in Faraday Future on 25th May 2018 in exchange for a 45% stake. Evergrande Health is also committed to investing an additional $ 600 million by the end of 2019 and an additional $ 600 million by the end of 2020.
Out of 25th In July, Jia Yueting informed his investor that the $ 800 million had already been exhausted and asked him to postpone his investment of 2019 and a portion of its investments from 2020 to 2018. Evergrande Health agreed to move forward 700 million additional dollars under certain undisclosed conditions. However, it appears that these conditions were not met (according to Evergrande) and that they did not pay the $ 700 million, Jia Yueting was forced to force the company to do so by arbitration and to deprive it of its shareholder rights.
Regardless of the arbitration, this dispute raises very serious questions about Faraday Future and its management:
First 800 million dollars. The deal was signed between Faraday Future and Season Smart on September 30th.th November 2017 and presumably a strong financial plan was in place. This would have matched the investment tranche schedule, which means that the $ 800 million was to last all of 2018. However, just 58% of the total until 2018, Faraday Future is already running out of money. money and ask for all the money for 2019 and part of 2020 too. This strongly suggests that Faraday Future's fiscal discipline and financial management are totally disordered, as it appears that the spending plan has been overtaken. This, combined with the fact that Faraday Future is still struggling with a dispute with his previous CFO, who has a good track record (see here), adds to concerns about Faraday's financial management.
Secondly, suppliers: Once again, Faraday seems unable to pay its suppliers. The group that helped Faraday Future launch the FF91 at CES in 2017 has still not been paid and has taken legal action this summer (see here). In addition, The Verge (see here) claims to have recruited more suppliers who were not paid for the work they did or for the equipment they provided. This raises further questions about what happened to the $ 800 million spent by Faraday Future between the 25th May 2018 and July 30, 2018.
Third, the product: Once again, according to The Verge (see here), the first and only prototype of FF91 caught fire after being shown to employees and their families. Through non-disclosure agreements, the extent of the fire is not known, but that may not be a good sign, as mass production is expected to begin in Q4 18 This incident can not be corroborated elsewhere and the sources are not named, which makes it difficult to give any weight to this supposed fire. However, this still raises other issues that Faraday Future has not given any answer to.
This arbitration raises even more problems with regard to the strength of Faraday Future, which certainly has money problems and can also present serious defects with its product. The red flags combined with the history of the company and the current leadership do not allow me to believe that the FF91 will ever see the light of day.
In addition, the last thing to do when one is saved is to fight against his benefactor, which leads me to question the ability of Jia Yueting to run this business (see here).
Clearly, Faraday Future's best chances of success will be achieved with a brand new leadership totally disconnected from its chaotic past. Byton, who has also amassed a similar amount this year and looks good on it, is a much better bet.
