Elec­tric car maker scraps $1B plant plans

The Denver Post - - BUSINESS - By Ali­son Noon

CAR­SON CITY, NEV.» An elec­tric car maker said Mon­day it is de­sert­ing its plan to con­struct a $1 bil­lion man­u­fac­tur­ing plant in south­ern Ne­vada eight months af­ter sus­pend­ing the project and sink­ing at least $120 mil­lion into it.

Fara­day Fu­ture halted work on the project out­side Las Ve­gas last Novem­ber, call­ing the stop­page then a “tem­po­rary ad­just­ment” that wouldn’t af­fect plans to be­gin pro­duc­tion in 2018.

Fara­day Fu­ture chief fi­nan­cial of­fi­cer Ste­fan Krause said Mon­day’s de­ci­sion to scrap the plant was due to a shift in busi­ness strat­egy. The Gar­dena, Calif.-based com­pany said in a state­ment that it will now look for an ex­ist­ing fa­cil­ity to pro­duce its elec­tric ve­hi­cles in Cal­i­for­nia or Ne­vada.

The an­nounce­ment 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. The com­pany said Jia’s fi­nan­cial prob­lems were not re­lated to the de­ci­sion.

Thou­sands of jobs had been an­tic­i­pated to come with the con­struc­tion and launch of the pro­posed plant on a 900-acre site at the Apex In­dus­trial Park in North Las Ve­gas.

State Trea­surer Dan Schwartz, a critic of the project, blamed state of­fi­cials for giv­ing false hope that the plant “would mag­i­cally cre­ate 4,500 jobs.”

“The promised jobs are yet an­other mi­rage in the south­ern Ne­vada desert,” he said.

The state had pledged $335 mil­lion in in­cen­tives to the com­pany, but had not yet spent any tax­payer money on the project, ac­cord­ing to Steve Hill, di­rec­tor of the Gover­nor’s Of­fice of Eco­nomic Devel­op­ment.

Hill said the com­pany was re­quired to in­vest at least $1 bil­lion be­fore it re­ceived the tax breaks and in­fra­struc­ture im­prove­ments ap­proved by state law­mak­ers in 2015.

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