Faraday Future confirms layoffs and wage cuts as struggles continue
The cutbacks come in the midst of a standoff with a major investor.
The future of Faraday Future is starting to look bleak. The electric car startup has laid off part of its workforce and is slashed the wages of its employees by 20 percent, as first reported by The Verge and confirmed in a statement from a company spokesperson. The move comes as the company is in the middle of a standoff with the company's primary investor.
Staffers at the company learned of the cuts via a Sunday email from CEO Jia Yueting. The chief executive will be decreasing his salary to $1, and some members of management are taking salary cuts beyond the 20 percent threshold, though that likely won't provide much comfort to the folks in the factory seeing their pay reduced starting next week.
The cuts were announced just weeks after Faraday Future was accused of trying to back out of a deal with Chinese real estate company Evergrande Health Industry Group. The firm's backing was initially viewed as a potential saving grace for Faraday, which has suffered major setbacks by way of abandoned factories, an executive exodus and CEO troubles. Faraday's Yueting accused Evergrande of failing to fulfill its financial promises to the company, and Evergrande returned the skepticism by saying it got manipulated into giving the electric car company $700 million to save it from going under.
While Faraday Future takes a hatchet to its workforce, the company is also dealing with a number of contractors knocking on its door and demanding pay for back work. It's starting to look like the lights might go out on the electric car maker.
The company's full statement is below:
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Effective immediately, all FF salaried employees will receive an immediate 20% cut to their annual base salary, and effective next week, all hourly employees will receive a 20% cut to their hourly wages. The Company is committed to monitoring its finances and will reevaluate this decision with the goal of restoring salaries once funding is available. As an additional measure, we are reducing our headcount. We recognize that those who are now leaving have contributed tremendously to FF, and we appreciate their contributions.
During this transitional phase, FF Founder and CEO YT Jia has decided to take a $1 annual salary. In addition, members of the leadership team have volunteered to take a further reduced salary beyond the 20% reduction.
We take pride in our close-knit community, and we are mindful of the impact these changes will have on our employees and their families. These steps are unfortunate given the great progress we have made as a company in recent months. The Company is taking concrete steps, including pursuing funding opportunities with those who share our vision. We are committed to making progress towards our goals, and continuing the necessary investments in our people, our products, technology, and business to develop an industry-leading connected mobility ecosystem. No further information related to the financial state of FF including additional business operations will be communicated at this time.
