Remember Faraday Future, the electric-car startup backed by Chinese bajillionaire Jia Yueting? The company that hoped to unseat Tesla as America's youngest, hippest manufacturer of zero-emission vehicles?
Well, its plans have hit a snag--a fairly big one, in fact. Is it time for a deathwatch?
Back in April, Faraday broke ground on its first plant--a massive, 900-acre, $1 billion facility outside Las Vegas, Nevada. Even then, as the first, celebratory shovel-fuls of desert sand still lingered in the air, there were doubts about the company's aggressive plans.
According to Faraday's initial timeline, cars would start rolling off the assembly line by 2018. But at the groundbreaking, Faraday issued a press release that quoted its vice president for global manufacturing, Dag Reckhorn, as saying that "Our aim is to complete a program that would normally take four years and do it in half the time, while still doing it right."
In other words: 2018 wasn't a guarantee.
And that was fine. Anyone who's ever built anything, from a house to a shopping mall to a model airplane, knows that construction is a tricky business. Things pop-up--unforeseen things that alter timelines in ways that no one had anticipated.
But last month, legitimate red flags went up when reports indicated that the lead contractor on the building project hadn't yet been paid. At the time, construction firm AECOM had invoiced Faraday for deposits and services totaling $58.1 million.
When the news leaked out, Faraday and AECOM huddled up and put out a joint statement about their "strong" relationship and saying, essentially, "Move along, nothing to see here, everything's fine". Faraday insisted that construction would continue as planned, but AECOM was noticeably silent on that point.
This week, AECOM seems to have hit the breaking point, suspending work at the site. Neither AECOM nor the automaker-to-be has commented about the exact cause of the stoppage, but Faraday says that it's "working with" AECOM during this "adjustment period". Construction is currently scheduled to restart in 2017.
When in 2017? That's anyone's guess. However, Jia Yueting recently announced that his high-tech firm LeEco is short on cash because the company has expanded too quickly--a recurring theme in his world. If we had to guess, we'd say work on Faraday's factory will probably relaunch later rather than sooner.
Should investors be worried--investors like the state of Nevada, which ponied up $200 million in incentives to entice Faraday to build there?
Probably not--at least not yet. To be sure, we've seen overly ambitious car startups go belly-up in recent years. And we'd be lying if we said Faraday Future didn't remind us of another laughably bold, deeply secretive car company that tanked before it built a single vehicle.
The difference between those two companies is Jia Yueting himself. Unlike many that have come before him, Yueting has cash--loads of it--and he has connections to even more. We wouldn't be surprised if Faraday's tone became a bit humbler in the future, but for it to scrap its plans altogether seems unlikely.
For now, Faraday says that it's "refocusing its resources" on another prototype that will debut at the 2017 Consumer Electronics Show in Las Vegas. Stay tuned.