We’ve heard things were bad at Faraday Future for a while, but after securing $2 billion in funding and completing its first body-in-white ahead of schedule, it sounded like FF may have turned things around. Unfortunately for the employees who depend on the electric car startup for a paycheck, the latest news paints an extremely bleak picture of the company’s future.
The Verge reports that Nick Sampson, one of Faraday Future’s three co-founders, has resigned. That development comes only a day after news broke that Peter Savagian, the company’s senior vice president of technology and product development, had left the company. In an email obtained by The Verge, Sampson even went so far as to call FF “effectively insolvent.”
In a statement, Faraday Future said, “We can confirm the recent departures of Peter Savagian, SVP, Global Product and Technology and Nick Sampson, SVP, Product Strategy—we wish them the best of luck in their future endeavors.”
Losing two top brass would be bad enough on its own, but last week, it was also reported that a slew of employee would be hit by layoffs, pay cuts, and furloughs. In addition to every employee receiving a 20-percent pay cut, those that have been laid off reportedly had the 20-percent cut applied to their final paychecks and received no severance.
Faraday confirmed that all employees hired after May 1 will be required to take an unpaid furlough lasting at least through December, but it could last longer depending on how soon funding can be secured. Salaried employees who were hired before May 1 may continue to work “at a reduced level of compensation,” according to Faraday. That reduced level is reported to be $50,000 a year. Meanwhile, hourly workers will be paid minimum wage. These changes will “basically shut down the company,” wrote Sampson in his resignation email.
As bad as all that sounds, Sampson isn’t ruling out one day coming back to Faraday, writing, “If circumstances should materially change, I certainly would consider returning to the company.”
In its statement, Faraday said the company received a “favorable ruling” in its arbitration against Evergrande, the Chinese real estate group responsible for the recent $2 billion investment. That means the startup is now free to seek other sources of funding, though it admits that process will take time, which is why the furlough period is open-ended. If CEO Jia Yueting can find a new investor, or work out the disagreement with Evergrande, it’s possible FF could turn things around. We’re just not going to hold our breath.
Source: The Verge 1, 2, 3
The post Faraday Future Founder Quits, Calling Faraday’s Future Into Question appeared first on Motor Trend.
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