Faraday Future mysteriously stormed into the U.S. market promising a new breed of electric car that would upend Tesla.
It unveiled a supercar concept and has teased a coming crossover. It has broken ground on a $1 billion factory in Nevada. Curiously, the company has never sold, or even produced, a single production-worthy automobile.
Now its parent company, China-based LeEco, has sent a dire warning to employees that it’s having financial troubles and needs to cut costs.
Could Faraday’s Future be over before it even begins?
LeEco CEO Jia Yueting reportedly has sent a letter to employees warning of impending cost cuts. The letter, as reported by The Global Times, blames the problems on an unsustainable growth pace and organizational limitations that have led to “an apparent lack of momentum” in different segments.
The Times said,
The internal letter came in response to growing concerns plaguing the Chinese tech group, which has expanded into smartphones, smart TVs and self-driving vehicles.
We don’t know if employees at Faraday in the U.S. received the letter or how funding for the automotive startup will be affected. We do know, however, that when corporate overlords start having money problems, they tend to reduce, or eliminate, funding to unnecessary ventures. An automotive startup in a foreign land with zero sales could easily be classified as unnecessary.
So far it looks like Faraday will stay the course. Just this week the company released another teaser of its upcoming crossover, which is expected to be unveiled at the 2017 CES Show in Las Vegas. Here’s a hint: It has wheels and looks like direct competition to the Tesla Model X.
Would you buy a car from a startup company that’s struggling financially?