Tesla gets shadowy CA competitor

Faraday-FutureTesla, Elon Musk’s famed electric car company, just lost a slice of the Golden State limelight.

Speculation has swirled around the debut of another entrant into California’s crowded, cutting-edge automotive industry. The company, known as Faraday Future, “has been hunting for a place to build what it says will be a $1 billion manufacturing plant for a new line of cars,” reported the San Francisco Chronicle. “Four states are contenders and the company says to expect an announcement within weeks.”

Contenders for the site included not only California but Georgia, Nevada and Louisiana, Faraday Future Product Development Chief Nick Sampson said, according to the Wall Street Journal. “Mr. Sampson is one of a team of former Tesla executives now leading Faraday Future. Like Tesla, Faraday Future is named after an inventor from the 19th century.”

High hopes, low profile

The company has responded to the media spotlight by cultivating an air of mystery from its Gardena headquarters south of Los Angeles — the former home to Nissan’s sales HQ, noted the Journal. Reporters have had to wade through obscure documents to collect details about Faraday’s origins. “Though it won’t confirm the source of its funds, documents filed in California point to a parent company run by a Chinese billionaire who styles himself after Apple’s late Steve Jobs,” the Chronicle observed.

That billionaire has been identified as Jia Yueting, the chairman of Chinese tech company LeTV, short for Leshi Internet Information & Television — one of the largest online video companies in China. “He recently launched a line of smartphones and acquired a 70 percent stake in Yidao Yongche, an Uber-like car service in China,” reported the Los Angeles Times.

In a press conference late last year, Leshi spokesperson Jiang Dongge said the company has “already organized a research and development team based in Silicon Valley about a year ago, with experts poached from traditional car companies including Tesla Motors, Mercedes-Benz and Ford Motor Company working on the forthcoming model. Leshi is also in touch with Google as well as other technology firms based in Silicon Valley,” he claimed, according to Forbes Asia.

Close competition

Although some Californians may bristle at the thought of a Chinese company pouring billions into competition with homegrown Silicon Valley products, analysts have linked up Faraday’s relative secrecy to its interest in foreign, not American, markets. “A lot of the evidence to support Faraday Future’s backing from the Chinese tech conglomerate is of public record. So why all the dodging from Faraday? It may have something to do with the way the company plans to market its vehicles,” Techcrunch speculated. “According to a source familiar with the matter, Faraday Future needs to be seen as a U.S.-based Tesla rival. ‘Chinese people don’t want to buy Chinese products,'” said the source.

But the dizzying costs of launching a high-end electric car company have ensured that any additional player in the marketplace will squeeze relatively more established firms. And Faraday has already been preceded in California by another Chinese concern. “Karma Automotive, formerly Fisker Automotive, which is based in Southern California, has revived its hopes after China’s Wanxiang Group Corp. bought the failed hybrid-electric supercar maker out of bankruptcy in 2014,” the Journal reported. “The company has secured a manufacturing facility in Southern California and is planning to sell a new car in 2016.”

Cross-border competition

For their part, California officials faced a fresh possibility of losing out to neighboring Nevada on big-ticket electric car construction. “If North Las Vegas lands the factory,” Bloomberg noted of Faraday’s future plant, “it would be the second major coup for Nevada as it attempts to diversify its economy and promote itself as a center of electric-car manufacturing. Tesla is building the world’s largest lithium-ion battery factory east of Reno after Gov. Brian Sandoval last year signed off on tax breaks worth as much as $1.3 billion for a plant on which Tesla expects to spend $10 billion over 15 years.”

3 comments

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  1. Richard Rider
    Richard Rider 12 November, 2015, 16:12

    If this company decides to open its factory in California, that will be proof positive that this venture is a scam. In this day and age, no sane manufacturer opens a manufacturing company in California.

    FACT: From 2007 through 2010, 10,763 manufacturing facilities were built or expanded across the country — but only 176 of those were in CA. So with roughly 12% of the nation’s population, CA got 1.6% of the built or expanded manufacturing facilities. Stated differently, adjusted for population, the other 49 states averaged 8.4 times more manufacturing growth than did California.
    http://www.cmta.net/20110303mfgFacilities07to10.pdf
    — prepared by California Manufacturers and Technology Association

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  2. Bill Gore
    Bill Gore 12 November, 2015, 20:33

    So the master con artist Musk is sweating it out since another electric car con artist arrived in town. These guys can spot each other a mile away. Tesla has yet to earn dime for shareholders, I suspect it never will.

    Reply this comment
  3. ricky65
    ricky65 13 November, 2015, 08:26

    I read another article which may be a more likely scenario regarding the Faraday project.
    The speculation is that it’s really Apple behind this. They are sitting on hundreds of billions in cash and have indicated an interest in the past about building an electric car.
    Hard to believe any Chinese company would even think about building cars in the US just to market them to their domestic market.
    I’m thinking Farady is a Apple front company or possibly Google backed since they’re sitting on tons of cash too. Most likely in any case a silicon valley based project.
    And Richard Rider is right. The auto plant will never be built in Cali should this thing ever get off the ground. No sane corporation wants to get their pockets fleeced and regulated at the same time by state nanny overseers with their jackboot on their necks.

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