Faraday Future Cuts A Deal With Nevada For New Factory

Faraday Future, the secretive automotive start-up from Southern California, has agreed to build a new $1 billion dollar factory in North Las Vegas, Nevada. The deal was announced by company officials and Nevada governor Brian Sandoval on Thursday. According to Bloomberg News, Nevada has agreed to a package of tax incentives and sales tax credits worth $215 million over 15 years. “This solidifies Nevada as the place where the future of transport is happening,” the state’s economic development director, Steve Hill. “People throughout the globe, throughout the country, are talking about Nevada. This is an exceptional opportunity.”

Faraday expects to have 4,500 employees with an average wage of $22 an hour at the North Las Vegas factory, Hill said. The total economic impact from the new factory is estimated at $85 billion over 20 years. It is expected to generate $760 million in tax revenue during that period for state and local governments and schools, Hill said.

Nevada is trying to re-position itself as something more than a gambling mecca and haven for legal prostitution.  The transformation began when Tesla Motors selected a vacant tract of land north of Reno as the site for its GigaFactory, a project that will ultimately add up to $5 billion to the state’s economy.

The Nevada legislature must still approve the proposed incentive package, but that is not expected to be a problem. Governor Sandoval traveled to China earlier this year to negotiate with Faraday’s principal investor, Jia Yeuting. He is currently #17 on Forbes’ list of China’s wealthiest men. Last year he was #78. It has been a very good year for Yeuting, whose LeTV company sells electronics and online content throughout Asia.

Faraday says it will unveil a concept version of its new car at the Consumer Electronics Show, which kicks off January 5 in Las Vegas. Until then, very little is known about the company, other than general statements on its website. About 60 former Tesla employees are now working for Faraday, including Nick Sampson, senior vice president of R&D and engineering, and Dag Reckhorn, vice president of global manufacturing. Reckhorn was deeply involved with creating the production facilities for the Tesla Model S.  Faraday’s lead designer is Richard Kim, a veteran of BMW.

Like all start-ups, Faraday promises to “disrupt” the car business with “ground breaking” new technology, “state of the art” connectivity, and “advanced” autonomous driving features. There are hints that it will pioneer new ownership models and focus on delivering content to the central touch screen so drivers never have to be out of touch with the Facebook and Twitter accounts. Recently, Tamara Warren of The Verge, was among a group of reporters invited to take a tour of the company headquarters near Los Angeles, where a Faraday was on display but kept under wraps. She was sworn to secrecy, but said “the shape was distinct from anything I’ve seen on the road.”

Elon Musk has said recently he craves more competition in the electric car marketplace. With Faraday just down the road, BAIC about to jump into the pool with Atieva, NextEV lurking in the shadows, and new cars in the offing from Google and Apple, it looks like Elon is going to get his wish.