Chinanews client, Beijing, February 2 (Zhang Xu) Under the wind, Evergrande Motor rushed to a market value of nearly 4,000 Hong Kong dollars, and the FF founded by Jia Yueting seemed to have a turning point.
On January 28, Faraday Future (FF), an electric vehicle company founded by Jia Yueting, announced that FF had reached a final agreement on business combination through a special purpose acquisition company (SPAC). After the transaction was completed, the new company was valued at approximately US$3.4 billion. , About 22 billion yuan, and will be listed on the Nasdaq under the stock code "FFIE".
Is Jia Yueting's dream of building a car really going to become?
Data map: Jia Yueting.
Who is paying for Jia Yueting's dream?
The so-called SPAC (Special Purpose M&A Company) is a form of listed company unique to the US capital market.
Its special feature is that instead of buying a shell to go public, it first builds a shell, raises funds, and then conducts mergers and acquisitions, ultimately making the target of mergers and acquisitions a listed company.
According to FF Automotive, FFIE investors include large financial institutions from the United States and Europe, "China's top three private auto OEMs" and "a Chinese first-tier city."
Soon, "China's top three private auto OEMs" surfaced.
Geely Holdings said on January 29 that it participated in a small amount of investment in FF's listing and will also explore the possibility of foundry.
Geely Holdings announced its cooperation with FF.
As for the "first-tier cities in China" that participated in the FF listing and investment, the industry generally believes that Zhuhai, Guangdong.
Sky Eye Check shows that on December 14, 2020, France-French Automobile (Zhuhai) Co., Ltd. was established. Its business scope includes the sales of new energy vehicles and the sales of new energy vehicle production and test equipment.
The company has a registered capital of US$250 million and is wholly-owned by FF Hong Kong Holding Limited. The legal representative is Jia Chentao. It is worth noting that Jia Chentao is also a supervisor of LeEco Eco-Auto (Zhejiang) Co., Ltd.
Fafa Automobile (Zhuhai) Co., Ltd. is controlled by FF.
Data comes from Sky Eye Check
In addition to capital investment, the "China's first-tier city" will also establish a joint venture with FF, and provide subsidies, and preferential policies such as about 2,000 acres of industrial land.
With IPO financing, government support, and big shots, FF seems to be in sight. Can Jia Yueting "return to China next week"?
Jia Yueting "return home next week"?
FF has always been Jia Yueting's dream, but the cost of building a car far exceeds his imagination.
According to the "Report on Investment and Financing of New Energy Vehicles in Recent Ten Years" released by Enterprise Chacha, as of the end of 2020, 8 rounds of financing have been disclosed since the establishment of FF, with a cumulative amount of 30.96 billion yuan. Among domestic new energy vehicle brands, the financing amount is only Second to NIO.
Before FF achieved mass production, external blood transfusions were always required, and the first to be dragged down was LeEco Empire.
As early as December 9, 2014, Jia Yueting stated on his personal Weibo that the automobile industry is facing a huge revolution in the mobile Internet era, and LeTV wants to build the best Internet smart car.
The data comes from Enterprise Check.
Car building is an asset-heavy project. Can the video-based LeTV support it?
In response to doubts, Jia Yueting publicly stated in 2015, "Even if the listed company is dragged down, I will not hesitate."
He believes that “funding is not a problem. As long as the strategy is forward-looking and leading enough, the product is sufficiently subverted, and there is enough user value, as long as your organizational capabilities are strong enough, as long as you can get things done, the funds will naturally follow.”
But LeEco failed to withstand the pressure in the end, and funds did not continue to follow, and LeEco was dragged down.
In November 2016, Jia Yueting admitted in an internal letter that there was a problem with LeEco’s funding situation.
In May 2017, LeTV made a major layoff and suffered debt collection from suppliers.
Two months later, Jia Yueting left LeTV’s mess and left the United States to help FF complete the financing.
Since then, "Jia Yueting will return to China next week" has become a stalk on the Chinese Internet, and Jia Yueting himself has not returned to China.
Jia Yueting's debt problem has greatly hindered FF's financing progress.
For this reason, in September 2019, Jia Yueting resigned as CEO and took the post of CPUO (Chief Product and User Officer), and CEO Bi Fukang took over as FF Global CEO.
On July 2, 2020, Jia Yueting announced that he had completed personal bankruptcy and reorganization in the United States on June 26.
"For me personally, this means the restart of life." In addition, Jia Yueting also said that FF's IPO plan is progressing in full swing, and the current progress is good. "We are planning to complete the IPO project quickly in the short term. Lay a solid foundation for FF's future development, and let FF achieve greater success."
Jia Yueting issued an open letter apologizing.
Picture from Jia Yueting public account
At that time, FF's situation was not optimistic.
According to documents submitted by Jia Yueting to the court in early 2020, as of December 31, 2018, Faraday Future’s cash and restricted cash totaled only US$7.4 million and a working capital deficit of US$579.1 million.
As of July 31, 2019, the company had accumulated losses of US$2.15 billion and liabilities of US$801 million.
Moreover, Jia Yueting's personal bankruptcy does not mean that he can be "debtless and light."
Jiang Zhenxiang, vice president of the Bijie City Lawyers Association, told the China News Network that the passage of the bankruptcy plan does not mean that his debts will disappear naturally.
"Domestic creditors can still claim rights against them based on relevant creditor's rights documents, unless they have paid off all the debts paid by the court, or reached an enforcement settlement with the applicant for enforcement and fulfilled the obligations stipulated in the enforcement settlement agreement."
How far is FF from mass production?
The key to the success of FF lies in its market prospects.
In the roadshow materials, FF announced the timetable for its first mass-produced model FF91, the "restart plan" in the first quarter of 2021, and delivery in the first quarter of 2022.
FF91 undergoing alpine test.
Picture from Jia Yueting public account
As early as the January 2017 press conference, Jia Yueting announced that "The FF91 model completely subverts human perception of cars and is a brand new species."
But it has not been mass-produced for several years, and FF has also been questioned as "painting a pie."
The current CEO of FF, Bi Fukang, stated in 2019, “Ensure that FF91 can enter the market and be delivered to consumers before September 2020”.
In July 2020, after completing the personal bankruptcy procedures, Jia Yueting once again expressed his confidence in FF in an open letter, "there is only one step away from delivery, and the shared smart travel ecology is about to emerge."
But this is a bit long.
A few days ago, FF stated in roadshow materials that the merger transaction on the listing provided approximately $1 billion for FF, "providing sufficient financial support for the mass production and delivery of FF91."
According to the FF public plan, after obtaining financial support, production bases will be established in the United States, China and South Korea.
The plant in California, USA, will be the first to supply, with an estimated annual production capacity of 10,000 vehicles.
Domestically, FF stated that, benefiting from the support of Geely Holdings and "a Chinese first-tier city", starting from 2025, domestic joint ventures are expected to have an annual production capacity of 100,000 to 250,000 units.
However, its factories in China and South Korea are still under construction, and it is still uncertain whether the follow-up cooperative foundry can be implemented as scheduled.
FF also announced in the roadshow that FF91 has received 14,000 orders worldwide, and it is expected that global sales will exceed 400,000 in the next five years.
But in the eyes of industry insiders, since 14,000 orders can be cancelled at any time, this statement is actually full of many variables.
What's more, compared to a group of new car-building forces, FF has already fallen behind.
ES6 displayed at Weilai Experience Store in Chaoyang District, Beijing.
Photo by Zhang Xu
For example, Weilai Automobile’s first production car, ES8, was officially announced in 2017 and delivered in 2018.
Listed car companies such as Xiaopeng Motors and Ideal Motors have already crossed the 10,000 mark. If FF wants to catch up with Xiaopeng's mass production, it will have to wait until 2024.
Zhang Xiang, an automotive industry analyst, told a reporter from Chinanews.com, “From the perspective of positioning, FF91 is a super luxury car with both opportunities and challenges. The opportunity is that the domestic super luxury car market is still a blue ocean with no competitors. But because of pricing If it is too high, even if it is mass-produced, the sales volume may be relatively small. FF may want to sell the brand through the first car, and then use economic models to make money later."
FF's roadshow materials also show that FF81 will be priced at about 59,000 U.S. dollars and will be delivered in 2023, and FF71 will be priced at about 45,000 U.S. dollars and will be delivered in 2024.
The two models have a lower positioning than the FF91, and the prices are much more affordable.
Jia Yueting's idea is very good, but in the turbulent new energy vehicle market, FF started early and caught up with the late episode. Is there still a chance in the future?
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