The co-founder of the struggling Faraday Future, Nick Sampson, has resigned from his role, claiming the company is “effectively insolvent” and unable to pay its debts as even more employees are reportedly furloughed and operations scaled back.
After laying off staff and cutting wages across the company by over 20 percent last week, Faraday Future continues to struggle with paying off its debts amid a battle for more financing, the Verge reports.
The company’s attempts to trim back spending that week were not enough, forcing Faraday to reportedly cease some operations at its California headquarters and factory, as well as institute a furlough, or unpaid leave, on all employees that began working after May 1, according to an email from CEO Jia Yueting obtained by the Verge.
On top of that, one of three company founders, Nick Sampson, resigned today, according to another email. His title was Senior Vice President of Product Strategy, and here’s a snippet of his resignation letter, via the Verge:
“The company is effectively insolvent in both its financial and personnel assets, it will at best will [sic] limp along for the foreseeable future. I feel that my role in Faraday Future is no long [sic] a path that I can follow, so I will leave the company, effective immediately.”
Sampson’s departure follows the resignation of former General Motors executive and Faraday’s senior VP of product development Peter Savagian, the Verge reports. That’s not to forget the waves of resignations that Faraday Future went through in 2016 and into 2017 as the company ran itself to the brink prepping the FF 91 for its CES reveal.
Faraday Future is currently locked in a battle for additional funding with its main investor, Evergrande Group, which denied a requested advance of the remaining $1.2 billion investment after Faraday burned through the initial $800 million back in July of this year. The arbitration case ruled that Faraday could instead seek $500 million in additional outside funding if approved by Evergrande, the Verge reports.
The result of the case, Sampson’s departure and the additional cuts put Faraday at its most grave position in the company’s tumultuous history, despite plans to enter series production of its FF 91 electric car by the end of this year.
We’ve reached out to Faraday Future for comment on the Verge’s report and will update when we hear back.
Update, 4:20 p.m.: A Faraday Future spokesperson confirmed to Jalopnik that all current employees, both working and furloughed, will keep their healthcare and other benefits during the furlough period, which the company anticipates will last through December of this year.