On Tuesday, electric car startup Faraday Future’s main financier—the Chinese tech conglomerate LeEco—announced a significant round of layoffs at its US operations. While that doesn’t seem to bode well for Faraday, the startup’s chief financial officer told staff that LeEco’s cuts won’t affect it, according to Forbes. Nonetheless, scores of more employees have reportedly left FF in recent weeks.
LeEco said Tuesday that it plans to eliminate about 325 jobs in the U.S. after failing to raise a significant amount of funds. The layoffs follow a decision by LeEco’s CEO, Jia Yueting, to step aside from running the company’s main unit and “partner” in developing Faraday’s flagship car, the FF 91. Initially, it wasn’t clear whether Faraday’s future (sorry) would be imperiled, but the start up’s CFO said it’ll be just fine.
Here’s more from Forbes:
Stefan Krause, Faraday’s newly hired global CFO, discussed LeEco’s moves with employees today and said the cuts weren’t aimed at the unit. Krause, formerly CFO for BMW and Deutsche Bank, joined this year to help Faraday solve its own funding issues. To get the FF 91 electric supercar into production, Faraday now needs hundreds of millions of dollars from outside investors.
“Hearing about layoffs at our strategic partner LeEco is discouraging. However, I want to be clear that these layoffs have no impact on Faraday Future,” Krause told employees at its Gardena, California, headquarters today. “We remain committed to our immediate goals of diversifying FF’s investment sources and getting FF 91 on the road in 2018, and we remain confident in the outlook for diversifying FF’s global investment.”
Krause expectedly has an optimistic take on the situation. But a report early Wednesday from Electrek suggests “dozens” of employees have departed the start-up in recent weeks. Some have moved on to Tesla, Faraday’s hopeful competitor if it ever gets a vehicle into production. From Electrek:
Tesla snapped up a few engineers in the process, like Robert Taylor, a studio engineer, and Yong Dian Jian, a computer vision engineer on FF’s self-driving car team and who is now a staff computer vision scientist on the Tesla Vision team as of last week.
They are only two examples of several key employees leaving Faraday Future over the last month, including their director of vehicle purchasing, technical lead for self-driving sensors, senior engineering manager for chassis, technical program manager for digital products, director of electrical engineering and software, and more.
Faraday’s stated intention is to open a factory in Nevada at some point in 2018 to build the FF 91, an electric autonomous vehicle that looks good on paper but may never reach production if the start up fails to raise more funding to finish constructing the facility.
In February, Jia told Chinese news outlets that construction is contingent on “whether funding is in place or not.” (Who knows, maybe he realized that’s actually how things work during the interview.)
Forbes says Faraday “insists” that LeEco’s cuts won’t impact day-to-day work. We reached out to a spokesperson for comment and will update if we hear back.