While Faraday Future is forced to pause the launch of its FF 91 due to a lack of funds, the manufacturer may have found a solution.
Formalized in 2017, the 91 FF is not ready to see the light of day. If the luxury electric SUV looked very promising on paper, the catastrophic situation of Faraday Future called its launch into question. A few days ago, the firm finally announced a postponement of its marketing to the third or fourth quarter.
As a reminder, the start-up was initially counting on a launch during the summer. If the latter attributes this delay in part to the shortage of semiconductors, as explained Electrekanother problem also arises and concerns rather the finances of the company. And for good reason, his financial situation has been very difficult for several years and it doesn’t really seem to be getting better..
A lack of funds
Indeed, in a recent rapportthe young company founded in 2014 claims that it “needs additional cash to commercially launch FF 91”. Elle « is currently seeking to raise capital to fund its operations through December 31, 2022“. And the amount is colossal, since Faraday Future would need $325 million to finally be able to bring the relatively successful SUV to life. Indeed, only 401 pre-orders have been recorded in five years.
If the brand has a lot of trouble seducing customers and investors, the situation might however improve. In a new report published by the SECthe US federal financial market regulator and regulator, Faraday Future seems to have found a short-term solution to get back on track and finance the start of production of its Electric SUV.
A major investment
The brand seems to have found several investors ready to help in its development. This agreement takes the form of a convertible note, a system known in the world of start-ups and similar to a loan. The investor then waits until the company is more viable before turning that note into real stock, depending on the valuation of the company and the terms set. The maximum amount of the operation concerning Faraday Future might then reach 600 million dollars.
A group of investors might fund at least $100 million, while others might also participate, for an exact amount still unknown. If all goes well, this money should be used by Faraday Future to launch its FF 91 but also as working capital, in order to pay its suppliers but also its employees, among others.
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