Faraday Future is looking to sell about 900 acres in North Las Vegas where it originally intended to build its first electric car manufacturing operation. Map via Faraday Future
Written by David Castellon
Would-be electric car manufacturer Faraday Future (FF) looks to be clawing its way out of financial troubles by selling 900 acres of land in North Las Vegas.
A website promoting the sale put the asking price at $40 million for the land that had been the startup’s original intended site to build its first manufacturing plant. But in late 2017, FF officials shifted gears, deciding not to build the Nevada plant and instead lease a million-square-foot former tire-manufacturing plant in North Hanford to convert into a car plant.
Though the Hanford plant is smaller than the one envisioned in Nevada, company officials told The Business Journal in 2017 they changed plans because converting an already-constructed building would allow them to start production sooner.
Officials also said at the time that they planned to hold onto the land in North Las Vegas to possibly build an additional car plant there in the future, assuming sales of its new cars built in Hanford were successful.
The Nevada parcel is partially improved, and 700 acres have been fully graded, states a press release from the Gardena-based auto startup.
“The sale is the result of the ongoing optimization of business strategies at FF, including global reorganization, [research and development] resource integration and a reduction of its non-core assets,” it continues.
“FF’s operations strategy has changed since the 2015 purchase of land in the Apex Industrial Park in North Las Vegas,” with the company shifting its focus on producing its flagship FF 91 luxury SUV just at the Hanford plant.
Much of last year was spent converting that plant for car manufacturing, and that work reportedly was near completion when the company announced a dispute with its chief investment group, which had refused to pay out more of the $2 billion investment it had committed to FF. The group initially invested $800 million of it in late 2017.
That money just about ran out by mid 2018, prompting company officials to lay off or reduce pay to hundreds of their workers starting in October.
Before that, company officials had predicted they would be mass-producing cars by early March, and after the layoffs and furloughs they predicted they might have new investors and have people back to work by the start of March.
None of this happened, despite the company announcing Jan. 1 that it had reached a settlement with its investment group, Chinese real estate conglomerate Evergrande, ending the investment agreement and allowing FF to seek new investors.
But so far, potential investors have nibbled without taking any bites.
John Schilling, an FF spokesman, said Thursday in an email, “we have no new formal updates other than to say we are actively engaged in discussions with potential investors from around the world to secure the company’s future and execute on our mission of delivering the FF 91 to production.
“We will make an official announcement as soon as we have a better idea on the actual investment sourcing,” wrote Schilling, who didn’t make himself or anyone else from FF available to be interviewed.
As for the company, its current financial woes — on the heels of it nearly running out of money in 2017 — have raised questions on whether it can survive long enough to actually mass produce cars.
The company is facing additional problems, as rumors have abounded for months that FF has not paid many contractors and service providers.
Late last month, TheVerge.com, a tech, science and entertainment news website, reported that lawsuits were piling up, numbering 11, with FF creditors seeking about $80 million.
FF’s press release didn’t address the lawsuits or whether the decision to sell the Nevada land directly stemmed from them.
What it says is that “FF seeks to raise substantial capital in 2019, bring the 1,050-horsepower FF 91 to market as soon as possible and continue preparing the subsequent mass-production FF 81 for its introduction.”
The FF 81 is reportedly smaller than the SUV-sized FF 91.