Faraday Future has not had a good start of the year. The electric car manufacturer, a China-f funded company has decided to cut off the Nevada Factory production up to one fifth of the original sum. The company has been facing many financial and functional challenges since 2015.
The car maker has reportedly faced hurdles since 2015 including cash flow issue and high public debt has contributed several executive departures. Reuter reports that the company will produce only two of car models instead of seven models. Faraday will run a mini unit and produces two of the models at North Las Vegas, Nevada, a city official said late on Tuesday.
Faraday Future business deficit:
The company planned to invest $ 1.3 million in a 3 million square foot for the production unit of 150,000. Faraday told the city of North Las Vegas that it will be built a factory of 650,000 square foot. But the company managed to produce a very low production of cars less than 10,000 units per year.
Instead of a planned $1.3 billion investment in a 3-million square foot Nevada factory that would produce 150,000 cars a year. Faraday Future has told the city of North Las Vegas that 650,000 square foot factory would be built. According to sources speaking to Reuters, the facility could build fewer than 10,000 cars a year. Instead of a smaller unit, the company planned to build mega the company of $ 1 billion and the construction would be finished in August but no official word has been given to construction.
Brain Drain from The Faraday Future:
The is fetal reason behind the downfall of the company is brain drain due to financial issues. Two of the CEO has left the company, Marco Mattiacci and Joerg Sommer, Umran Ashraf the engineering director is going to leave the company. Including Ashraf, many other engineers are on the decision to go away. The human resource has been hired other competitor firms.
Putting ‘Over-extended’ Investments causes low cash flow:
Jia Yueting, a Chinese tech billionaire top investor of FF also CEO of LeEco, the electric car division of China. In November Yueting has admitted that the employee of Lessee are running in a shortage of cash due to it the business extension to U.S. Some of the LeeSee employees is behind Faraday future and has some negative impacts on it.