Faraday Future Halting Assembly Plant Construction in North Las - KTVN Channel 2 - Reno Tahoe Sparks News, Weather, Video

Faraday Future Halting Assembly Plant Construction in North Las Vegas

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Faraday Future Plant Rendering Faraday Future Plant Rendering

Electric car company Faraday Future says it is stopping plans to build an assembly plant in North Las Vegas due to cash troubles.

The upstart company spent at least $120 million developing a 900-acre site at the Apex Industrial Park in North Las Vegas in expectation that it could begin turning out cars there next year.

But construction had yet to begin when the company made its Monday announcement.

It came days after reports that a Shanghai court froze more than $180 million in assets belonging to one of the company's biggest backers, tech billionaire Jia Yueting.

Gov. Brian Sandoval and Nevada lawmakers approved $215 million in tax breaks and $120 million in infrastructure improvements for the project in 2015.

Faraday says the $1 billion, 3 million square foot development would have created approximately 4,500 direct jobs over a 10-year period to the state. 

Governor Brian Sandoval issued this statement: 

“Throughout the process of working with Faraday Future, my office, GOED and the Legislature made it a priority to ensure that Nevada’s interests and taxpayer funds were entirely protected. The agreement between the State and the company required a trust fund to hold any earned abatements until the company achieved a $1 billion investment. While I am disappointed in today’s announcement, I can say with certainty that Nevada’s citizens were held harmless financially. The State of Nevada continues to perform as one of the top economic states in the nation, drawing the interest of companies from across the county and the globe. Additionally, I know that APEX has the potential to become a world-class destination for advanced manufacturing and distribution centers and will be a catalyst in transforming Southern Nevada.” – Governor Brian Sandoval 

Statement from Steve Hill, Director of the Governor’s Office of Economic Development:

“Faraday Future has informed the Governor's Office of Economic Development (GOED) that it has put the construction of its factory in North Las Vegas on hold.

"Throughout the process of working with Faraday, the state recognized both the opportunity a large manufacturing facility could provide as well as the inherent risk associated with a start-up company attempting this endeavor. In order to completely protect the citizens of Nevada from risk, the agreement with Faraday requires the company to fully invest a minimum of $1 billion in order to receive any state incentives. In accordance with this agreement, Faraday has paid all taxes owed to a Trust Fund established by the state. The agreement with Faraday held Nevada’s citizens harmless from the risk associated with this project.” 

North Las Vegas Mayor John Lee released this statement: 

“The State, County and City are focused to ensure Southern Nevada has a large-scale industrial park developed and ready for job creators to diversify our regional economy, and Faraday has played an important part by investing almost $50 million in land improvements and critical design and engineering work at Apex Industrial Park, creating a momentum that has attracted multiple Fortune 500 companies hiring 7,000 Nevadans and investing more than $1 billion that has stabilized and transformed our community,” says Mayor Lee.

State Treasurer Dan Schwartz issued the following statement:

“We all make mistakes, but this one was obvious. Long after it became apparent that ‘a mysterious Chinese billionaire’and Faraday Future could never build a $1 billion electric auto plant, Nevada state officials continued to insist that Faraday Future would magically create 4,500 jobs in North Las Vegas. Now, Jia Yuteng, Faraday’s funding source, has had his assets frozen by a Shanghai court and is under increasing scrutiny in China for what amounts to fraud; the automobile plant is just a pile of sand in the APEX Industrial Park; and, the promised jobs are yet another mirage in the Southern Nevada desert. 
“The only good news is that the Treasurer’s Office continued to press for financial information from Faraday and refused to issue the $175 million bond without detailed information.
“Welcome to Nevada, where good government takes a back seat to bad deals.”

Faraday Future released this statement: 

"We at Faraday Future are significantly shifting our business strategy to position the company as the leader in user-ship personal mobility -- a vehicle usage model that reimagines the way users access mobility. As a result of this shift in direction, we are in the process of identifying a manufacturing facility that presents a faster path to start-of-production and aligns with future strategic options.
"Accordingly, we have decided to put a hold on our factory at the APEX site in North Las Vegas. As the land owner, we remain committed to the buildout of the APEX site for long-term vehicle manufacturing and firmly believe North Las Vegas is an ideal place for us to be.
"We would like to thank our partners in Nevada for their continued support throughout this process: Governor Sandoval and his office of Economic Development, Clark County and Mayor John Lee and the North Las Vegas officials."

(The Associated Press contributed to this report.)

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