Faraday Future said Wednesday it plans to start production of its all-electric FF 91 Futurist SUV at the end of March after years of delays, lack of capital and internal drama that threatened the company’s survival.
Faraday Future had previously indicated that production would start in March, but had yet to choose a date.
However, there are two caveats to this milestone. The company said in its full-year and fourth-quarter earnings report that production start will begin on March 30 if it receives the remaining funds expected from investors and if suppliers can meet its demands. Faraday Future said in February it had reached financial commitments from $135 million in convertible secured notes, capital that the company said could start production. Approximately $111.6 million in funds have been received. The company expects more incremental payments of $38.4 and $58.4 million.
Director During the company’s earnings call on Wednesday, Xuefeng Chen said he was confident the money would be received.
The FF 91 will be assembled at the Hanford, California facility. The first vehicles will come off the assembly line in early April and deliveries to customers will take place before the end of that month, the company said. Chen said the company will initially focus on sales in the Los Angeles area, followed by San Francisco Bay Area, And the New York subway region. In China, the companies initial sale attempts shall to start of Shanghai And Beijing, he said.
Faraday Future shares fell 8% to $0.51 per share before the earnings report was released. The manufacturing update helped the stock gain about 0.44% in after-hours trading, despite a rather dismal earnings report.
As a matter of fact, Faraday Future generated no revenue in the fourth quarter or 2022. Operating expenses were $451 million in 2022, compared to $354.1 million in the prior year. Faraday said that most of Ooperating expenses were in the first nine months of the year due to an increase in engineering, design and testing costs.
The company reported a net loss of $552.1 million for 2022, about 7% higher than the $516.5 million it lost in the same period last year. Net loss in the fourth quarter was $153.9 million compared to $84.3 million in the same period last year.
Faraday Future reported that it ended the fourth quarter with $18.5 million in cash and limited cash. The company’s cash position has improved and now stands at $37.5 million, including restricted cash of $2.1 million as of March 3, 2023.
While there are conditions attached to that production start date, it still marks a turnaround for a company that was just four months doubts as to whether the company can continue in the coming year.
At the time, Faraday cited a number of circumstances delaying delivery of his FF 91, including whether suppliers could meet their deliverables, the timing and success of certification testing, and the implementation and effectiveness of the company’s workforce reductions. At the top of the list of concerns was whether Faraday would be able to secure the cash it needed to get through the year, let alone make its first deliveries.
The board ousted CEO Carsten Breitfeld a week later and named Xuefeng Chen, a former and longtime Chery Jaguar Land Rover executive who most recently headed Faraday Future’s China division, as its new leader.
Faraday Future has struggled with delays and drama for years, which escalated following its IPO in July 2021 via a merger with Property Solutions Acquisition Corp. fourth quarter, citing supply chain issues and a lack of cash.