Faraday Future admits to inflating reservation numbers

California-based electric car startup Faraday Future has admitted in a filing with the US Securities and Exchange Commission (SEC) that earlier statements that it had received more than 14,000 reservations for its debut model FF 91 “may have been misleading”.

The actual breakdown of the numbers was that only a few hundred of those reservations were actually paid, while the vast majority (14,000 in total) were unpaid expressions of interest. Moreover, Faraday Future was also not honest about Jia Yueting’s stake in the struggling company.

According to the Faraday Future announcement, “statements made by certain employees of the Company to certain investors describing Mr. Jia’s role within the Company were inaccurate, and Mr. Jia’s involvement in the management of the Company was more significant than what was represented to certain investors.”

The revelation will likely prove highly detrimental to the company, which already struggled with funding and even had to replace their CEO in 2019. However, Faraday is not throwing the towel yet, and has taken remedial steps to bring business back into line. For example, the company has announced that General Counsel, Jarret Johnson will be “separating from the company” and explained they “may take certain other disciplinary actions with respect to other employees.” Additionally, Faraday Future’s Vice President of Global Capital Markets, Jiawei Wang, was suspended without pay, while CEO Carsten Breitfield and Jia had their salaries cut 25%. Susan Swenson was also named Executive Chairperson.

investors.ff.com (PDF) via carscoops.com