Even if Faraday Future broke ground on its 1-billion-dollar plant in Nevada, the state’s authorities are asking for more “transparency” on the company’s plans.
The recently formed California-based Faraday Future took the automotive industry by surprise when it announced it would invest 1 billion dollars in a plant in North Las Vegas, with the aim of starting to build long-range electric cars to rival Tesla in a couple of years from now. But earlier this year, the state treasurer Dan Schwartz said he would not grant the negotiated subsides until the electric-vehicle startup backed by Chinese billionaire Jia Yueting could prove it had full liquidity or at least some of the cash. Schwartz recently expressed its reluctance once again, putting under doubt the company’s ability to secure financing for the plant, a project that also needs government support for some infrastructure investments in power lines, water mains and roads. He wants more transparency on the funding before approving 120 million dollars in bonds in this direction.
Schwartz, who is a former CEO of a private-equity firm in Hong Kong, has concerns over Jia’s reliance on equity-backed loans on its core business Leshi Internet Information & Technology Company. Leshi’s stock was halted in China for the first five months of this year and dropped 11 percent since it resumed trading on June, rising Schwartz’s concerns over Faraday’s funding, while also forcing him to ask for further explanations on how exactly the automaker plans to pay for the plant.
Following the deal between Faraday and the state, Neva also approved as much as 215 million dollars in tax incentives and credits for the facility, which is said to ultimately employ as many as 4,500 people.
Via Detroit News