Faraday Future is getting another $30 million to kick off its new, more affordable model lineup.
The words “EV” and “startup” have consistently made headlines through the year, though not for all the right reasons. Most of the focus has been on Fisker’s demise, though Faraday Future is another company that’s had a rocky few years trying to get its AI-focused, high-priced electric SUV to market. The company announced a new mainstream “Faraday X” brand in September, as some realization that it needs to shift greater volumes at more affordable prices to actually survive. Money isn’t exactly rolling into FF’s coffers these days, though, so it needed financial investment to actually get the idea off the ground. Now, it seems, the company has such funding to the tune of $30 million, according to an announcement earlier this week.
Faraday Future announced just before Christmas that it secured additional cash financing commitments to accelerate the rollout of the Faraday X brand, which aims to bring cars in the $30,000-$50,000 price band to market. Of that, $7.5 million is available to the company now. $22.5 million will be made available through unsecured convertible notes, as well as stock warrants for the investors to buy additional shares at a set price later on.
“The new funding lays a solid foundation for both FF and its new brand as the company approaches the end of 2024 and enters the new year,” said Faraday Future global CEO Matthias Aydt in the company’s official statement. “I am optimistic about the opportunities that this new funding will bring, including supporting the ongoing production of our FF 91 2.0 and the growth of the FX brand.”
On the FX side of the business, the company plans to roll out two new prototype mules at CES 2025 in early January. One SUV, which the company will likely call the FX 5, will run between $20,000 and $30,000. FF’s other debut, the FX 6, has a targeted price of $30,000 to $50,000. Not only will the cars have fully electric variants, but Faraday Future also reportedly plans to offer range-extended versions, probably as another nod to the relatively cool demand among the mainstream car buying public for expensive electric vehicles.
Will the $30 million actually be enough?
If you’re thinking the story of a beleaguered EV startup trying to secure funding to maintain operations and expand its lineup sounds familiar, you’re not wrong. Before its bankruptcy earlier this year, Fisker Inc. tried to secure $150 million to keep production going for its Ocean SUV, while also trying to expand its appeal with the “Alaska” pickup truck and even a “Ronin” sports car.
From Lucid to Rivian and Fisker to Faraday Future, EV startups trying to gain a foothold in the market have, at the very least, shown how brutally expensive it is to launch a new vehicle (and a new brand, for that matter). While Rivian is arguably the most successful of the bunch to-date, it’s also needed billions of dollars in support to expand its operations and capabilities in a wider market.
In the grand scheme of things, will $30 million be enough to save Faraday Future’s ambitions? Only time will tell, but FF reported a net operating loss of $234.58 million during the first nine months of the year in its third-quarter earnings call. In just the third-quarter alone, it posted a loss of $77.69 million, taking into account its operating expenses and payments on existing debt. This new funding round further leverages the company’s stock value, which is currently trading at around $1.34 per share, to keep going into 2025 and beyond. It’s also worth noting, though, that FF’s share price on the Nasdaq did tick upward by 23% this week, upon news of the additional funding.
