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Faraday Future struggles with economy, scale

Plans for Faraday Future's Nevada factory Source: Faraday Future

LeEco-backed automaker to produce two models instead of seven, as factory plans shrink

Faraday Future, the Chinese-backed maker of luxury electric cars, is reportedly scaling back its plans for US production.

The firm – a subsidiary of Beijing-based IT giant LeEco – will now launch two models instead of seven, reports Reuters, citing sources with knowledge of the company’s plans. It will also construct a far smaller car assembly plant north of Las Vegas than originally announced, said the news service, which interviewed a city official.

The company will only build the FF 91 flagship car, unveiled last month, and the smaller FF 81, designed to rival Tesla’s Model X, sources said.

Faraday will also now initially build a 650,000-square-foot (60,390-square-metre) assembly plant, instead of the 3 million square-feet facility originally announced in December 2015, said North Las Vegas city manager Qiong Liu. Sources also told the news agency that this smaller plant may only produce up to 10,000 vehicles a year, and may not be in production until 2019.

Even that may be ambitious, given that work stopped at the site in November, and no firm date has been offered as to when this will recommence.

However, in response to the report, Faraday Future put out a press release titled: “Faraday Future Multi-stage Manufacturing Strategy: No Scaling Back.” It stated that the company is “moving forward with a multi-stage manufacturing strategy” and that it will “soon embark on the second phase of Stage 1 Manufacturing Project, which will include the construction of a facility on site.”

“Faraday Future remains committed to the State of Nevada and our $1B investment in the region over the next few years,” it concluded.

The alleged scale-back is not an encouraging sign for the aspiring Tesla rival, which looks increasingly like a very risky bet for LeEco owner and entrepreneur Jia Yueting. As Nevada State Treasurer Dan Schwartz told China Daily in late 2016: “It’s clear Mr Jia doesn’t have any money, it’s clear that Leshi isn’t making money. That’s the reason for my concern.” Ours too.

 

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