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Nevada Demands Collateral Before Approving Faraday Future Plant Incentives

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On: Tue, Mar 1, 2016 at 2:37PM | By: Carl Malek

Nevada Demands Collateral Before Approving Faraday Future Plant Incentives

Nevada's state government wants to strike a deal with Faraday Future regarding plant incentives, but the state has demanded collateral from the upstart firm before it moves forward with approving anymore infrastructure improvement bonds. The new demand comes after comments by the state treasurer, Dan Schwartz, who fears that Leshi, a key backer for Faraday Future, may not have the money to actually fund the plant, according to a report by Automotive News.

The Faraday Future selected Nevada as the site of its new factory in early December, and revealed that vehicle production on the futuristic-looking FFZERO1 EV supercarcould begin as early as 2017. For its part, Faraday Future has done a great job in maintaining a high level of secrecy regarding its future vehicles. At the Consumer Electronics Show the firm unveiled the concept, which is touted to provide 1,000 horsepower and make the sprint to 60 mph in just under three seconds. However, the show car was just a static model with no drivetrain, and the preliminary renderings showed a completely different shape that made it look like a pod on wheels. Faraday designer Richard Kim told the folks at Autoblog that he has completed the final design of the production car, but was tight-lipped on what it would look like.

Prior to his election as treasurer, Schwartz was a banker based in Hong Kong; during a recen vacation there, he learned from a friend that Leshi may actually have trouble affording the $1 billion dollar plant. This comes on the heels of the Nevada legislature earmarking $215 million in tax incentives to help benefit Faraday Future and an additional $120 million in upgrades at Apex Industrial Park where the proposed plant would be built. Schwartz said, “My responsibility is to the Nevada taxpaye. I’m personally, and the office is, very much in favor of economic development, but what we don’t want to happen is to issue bonds that won’t be paid.”

It will be interesting to see whether Faraday's financial base can remain stable enough to successfully build the plant and, if so, whether Faraday's production models can live up to the promises of the FFZERO1 Concept.


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