Is the Electric Car Startup Faraday Future Doomed to Fail?
The self-styled competitor to Tesla is hyping a huge reveal in January, but rumors are swirling that the company is running on fumes.
Media coverage can be fickle, but for Faraday Future, a secretive startup funded by Chinese billionaire Jia Yueting, it’s been remarkably consistent of late. Several in-depth pieces about the company that has promised to compete with Tesla for the burgeoning electric car market have detailed a pattern of questionable business practices, and suggest the firm is heading toward collapse before selling a single car.
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As the Verge notes in its piece today, the company appears to be hiding its intellectual property in a shell firm, away from the eyes of investors and suppliers. While suspect, that in and of itself isn’t damning. But as the Verge and a recent BuzzFeed investigation both found, the company has been burning cash like crazy, appears to be running up huge debts, and Jia has co-opted employees from Faraday to work on a self-driving car project for his tech firm, LeEco. Employees have said the vehicle is vaporware.
Still, the company publicly insists its forthcoming car is going to wow the world. Promotional videos suggest its car can outduel Ferrari and Tesla on the racetrack. Faraday executives say the car will feature a battery of between 100 and 120 kilowatts—the lower end of which would match Tesla’s biggest battery pack. And people won’t own the cars—instead they’ll subscribe to them, summoning self-driving Faraday vehicles whenever they want.
The pitch sounds something like an ultra high-end Zipcar mashed up with ride-sharing and an autonomous vehicle—all of the buzziest themes in the personal transportation industry rolled into one.
Whether or not Faraday Future is in fact careening toward a spectacular demise should become clear soon. The company is planning to take the stage at the Consumer Electronics Show in Las Vegas in January to show off its first production model car. Last year’s CES was the scene of an embarrassing pratfall for the company—but this is still supposed to be its coming out party.
If all goes well, perhaps the company will have a future. If it doesn’t, Faraday may not have very much road left to travel. “If they don't find money after CES,” one source told the Verge, “they will be out of money by February.”
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