By on December 16, 2016

FFZERO1 Faraday Future

Faraday Future has yet to provide anyone the opportunity to say anything strictly positive about it this year. Even today, when there is the seed of good press stemming from a recent teaser video of its FF Prototype, the company remains mired by new allegations that highlight just how absolutely wrong everything about it appears to be.

A mountain of debt, an unsettling corporate structure, mounting lawsuits, staff abandonment, and problems with suppliers all coalesce to paint a grim portrait of the company as it draws nearer to its important reveal at January’s Consumer Electronics Show.

However, the details of a recent media expose wouldn’t look out of place in a sitcom.

BuzzFeed News reported that China’s LeEco relied heavily on Faraday Future to design its self-driving car, the LeSee. LeEco’s CEO Jia Yueting is a personal investor in Faraday Future and may play a role in its leadership. There is a distinct, likely intentional, lack of transparency surrounding LeEco’s relationship with Faraday. However, numerous former FF employees have stated before that the EV startup essentially operates as a branch of LeEco. The two even share resources.

One thing LeEco did not share, however, was a paycheck with the Faraday Future employees forcibly pulled off their own projects to design a car for their Chinese backer. In December 2015, FF employees reportedly received a mandate directly from Jia saying they needed to design a prototype that LeEco could show off publicly the following spring in China.

Here’s what BuzzFeed says happened next:

And in April 2016, LeEco unveiled a sleek, electric sedan called LeSee. On stage, Jia, who has been outspoken about his plans to usurp Tesla, touted LeSee as a LeEco creation as the white sedan glided across the stage to park in a mock garage. The audience couldn’t see that the seemingly self-driving car was in fact being piloted from backstage via remote control.

Sources from Faraday said that several employees were upset. LeEco had not given them credit or offered payment in exchange for services, despite the LeeSee development serving as a major setback toward the progress of their own vehicle. Any delay could be detrimental to Faraday, too. After last year’s embarrassing absence of a realistic production vehicle, the company needs to have something concrete to show the world if it is to maintain any credibility whatsoever.

Although, considering the company’s money problems, the point may be moot. Future broke ground on a $1.3 billion car factory in North Las Vegas last April — helped by $219.5 million in tax incentives from the state of Nevada. The facility was anticipated to create 4,500 full-time positions. By October, work at that location had stopped when site contractor AECOM notified Faraday that the company was $21 million behind on its September payments and that it would owe an additional $37 million for October and November.

Jia then announced that LeEco had overexerted itself financially. Despite having raised $1.08 billion for the LeSee project in September, Jia admitted to financial hardships in a public memo to employees.

Much more recently, parts supplier Futuris issued a lawsuit against FF for breach of contract. Futuris, which constructs seats for Faraday, claims the company became delinquent on invoices it had received this summer. It now owes Futuris more than $10 million. Another lawsuit, this one filed by Beim Maple Properties, alleges the company is behind almost $105,000 in rent payments for a warehouse.

[Image: Faraday Future]

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11 Comments on “Faraday Future-designed ‘Self-Driving’ Car was Piloted by Remote Control...”


  • avatar
    JohnTaurus_3.0_AX4N

    Faraday No-Future.

  • avatar
    Ermel

    Faraway Future.

  • avatar
    indi500fan

    Here’s a financial question:

    Do the execs of these dubious startups abscond with serious money or could they make that same kind of salary/bonus/etc doing legit stuff? Is the public song and dance just to inflate their egos?

    • 0 avatar
      wumpus

      The flip side of the coin is “do what ordinary executives really do different than this type thing”?

      It depends. There are two types of executive suites.

      1. The ones who own the company and built it. They know how the company works, how it makes money, and why it makes money (which is quite likely not the same way they were intending when they founded it. And sometime this isn’t true, but you can at least hope). The guys in question almost certainly can’t do this (and are failing before our eyes).

      2. The ones who are hired afterwards, typically hired by someone who wasn’t involved in getting it going. Basically all they need to do is keep the thing going. Expect them to be entirely political, making sure guys who support them get ahead and no others. Making money *this quarter* matters, and next quarter really doesn’t. I suspect that they could play this game (especially in sales), but it isn’t certain. They would probably be the ones bailing out of a dumpster fire with golden parachutes if they “succeed”.

  • avatar

    So far only Lucid Motors materialized. Perhaps someone should tell the Chinese that it’s getting awfully crowded too with Tesla contenders all operating in the higher EV segment. Which does not make sense for two solid reasons. One: the bigger the car, the more batteries it needs and the more expensive to produce. Two: big, self-steering cars are more accident prone than smaller ones.

  • avatar
    raph

    D’oh Nevada! I hope all those tax incentives have yet to be realized!

  • avatar
    Fred

    This is exactly why you never make investments based on photoshop promises. Today you can spit out prototypes with a 3d printer.

  • avatar
    Dave W

    I would think that with the tech turmoil, self driving and green pushes, and with a wealthy class so wealthy that it has no need to spend/invest it’s wealth for strictly productive purposes, the market would be ripe for a couple new car companies to get off the ground.

    So far it seems that Tesla has made real progress, but probably needs to break out of it’s high end niche to really become profitable, as well as the game changer Elon says hes aiming for. Elio is at least alive and grinding ahead,but unless the OPEC/Russian cooperation sticks to raise oil prices, Elio (and possibly Tesla) are sunk.

    If Kaiser/Frazer couldn’t make it as a well capitalized firm with real designers and production know how, in a postwar market starved for new cars I’m not sure who today has a real shot.

    • 0 avatar
      PeriSoft

      “If Kaiser/Frazer couldn’t make it as a well capitalized firm with real designers and production know how, in a postwar market starved for new cars I’m not sure who today has a real shot.”

      I don’t think a lot of these new guys have much of a shot either, but in fairness, things are probably easier for a new entrant now than they were when K/F started. The market is more splintered, it’s easier for consumers to find out about alternatives, there are more educated people capable of doing design, the design itself is far easier with CAD and well-developed FEA/CFD techniques, and suppliers exist for huge chunks of the tech that takes a long time to develop.

      But, like I said, it’s still incredibly hard. Tesla’s making a great drivetrain while failing to build a $100k car with windows that don’t rattle and that has unacceptable wind noise shows that.

    • 0 avatar
      SCE to AUX

      “So far it seems that Tesla has made real progress, but probably needs to break out of its high end niche to really become profitable”

      Well, if Tesla loses money on the Model 3, they won’t make it up in volume.

  • avatar
    SCE to AUX

    I think Faraday Future exists merely to make Tesla look healthy and normal.


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