Layoffs Loom at Faraday Future

Sean Szymkowski
by Sean Szymkowski

Embattled electric-car startup Faraday Future plans for new layoffs and salary reductions in an attempt to keep itself afloat.

The Verge reported Monday that the new measures come as the company enters arbitration in Hong Kong with its lifeline of an investor, Evergrande Health.

Faraday will cut company salaries by at least 20 percent, though some executives elected to take even larger pay cuts. The hourly employee workforce will also see its wages reduced by 20 percent, emails obtained by The Verge stated. Faraday Future CEO Jia Yueting will take a salary of $1.

It’s unclear how many employees the company will layoff or what departments they will come from, but no such actions have been filed with the state of California where Faraday is based. The company emails said it plans to fully restore salaries and wages when funding is available.

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Funding has been a major issue for Faraday Future throughout its life. The company faced major uncertainties in 2017 and nearly failed to make payroll before its grand deal with Evergrande Health came to light. The health division of the Chinese conglomerate offered up $2 billion over the next three years in return for a 45 percent stake in the company.

The company received the first $800 million this year, but the entire figure was spent in six months. When CEO Yueting asked for an advance on the next installment of funds, Evergrande denied him. Now, Faraday claims the company has not held up its end of the investment deal. It’s unclear what the arbitration outcome will be, but it doesn’t sound good.

The obtained emails also said Faraday Future is “pursuing funding opportunities with those who share our vision.”

[Source: The Verge]

A version of this story originally appeared on Hybrid Cars.

Sean Szymkowski
Sean Szymkowski

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