Source: Economic Observer
Reporter / Wang Haixuan
On January 29, Zhejiang Geely Holding Group Co., Ltd. (hereinafter referred to as “Geely Holding”) and Faraday Future, hereinafter referred to as “FF automobile”) respectively announced that the two sides have formally signed a framework cooperation agreement. The two sides plan to cooperate in the fields of technical support and engineering services, and explore the possibility of providing OEM services by a joint venture between Geely and Foxconn. At the same time, as a financial investor, Geely Holding Group also participated in a small amount of investment in FF auto spac listing.
As a result, FF automobile is expected to become the first customer of the joint venture between Geely and Foxconn. According to public information, on January 13, Geely holdings and Foxconn Technology Group (Foxconn) signed a strategic cooperation agreement. The two sides will set up a joint venture to provide OEM production and customized consulting services for global automobile and travel enterprises, including but not limited to automobile or parts, intelligent control system, automobile ecosystem and the whole process of the whole industry chain of electric vehicles. According to the agreement, both parties of the joint venture hold 50% of the shares.
With Geely Holding and FF auto official announced that they have signed a framework cooperation agreement, the speculation of FF auto investors in previous media reports has also been partially confirmed. On January 25, Reuters quoted a source as saying that FF automobile will open a factory in China and invite Geely to provide outsourcing manufacturing services, so as to promote its plan to produce pure electric vehicles in the Chinese market. On January 27, another domestic media reported that Zhuhai state owned assets will invest 2 billion yuan in FF automobile, and provide convenience for FF automobile to build production base in the local area.
Then, on January 28 EST, FF announced that it would be listed on the Nasdaq Stock Exchange in the form of SPAC, with the stock code of “ffie” (Faraday future intelligent ecosystem). “The cornerstone investors of pipe (private fund) include large financial institutions from the United States and Europe, China’s top three private automobile engine plants and China’s first tier cities.” FF car official said.
Up to now, the “top three private automobile main engine plants in China” officially referred to by FF has been confirmed as Geely Holding. But it is not known whether “China’s first tier city” is Zhuhai. On the afternoon of January 27, the reporter of Economic Observer network consulted the relevant staff of Zhuhai SASAC, and the other side said that “there is no matter that can be disclosed at present.”. In fact, Zhuhai is not a first tier city in the general sense of Beijing, Shanghai, Guangzhou and Shenzhen.
It is worth noting that FF automobile has been in a “half pause” state since its establishment in California in 2014. As the layout project of Jia Yueting’s “LETV ecology” in the automotive field, FF automobile has been implicated by the capital problem of LETV holdings for several times. Its first product ff91 appeared as early as 2016, but it has not been mass produced. In 2018, FF once reached a cooperation with Evergrande group, but then the two sides broke up because of their different ideas. This time, FF automobile’s US stock listing and financing, as well as its OEM cooperation with Geely and cooperation with China’s first tier cities, are another close to “restart” six years after its establishment.
FF auto official disclosed on January 28 that the merger transaction about listing provides about US $1 billion for FF, which “provides sufficient financial support for the large-scale mass production and delivery of FF 91”. FF 91 plans to launch in China and the United States about 12 months after the merger.
FF further disclosed its progress in product planning, supply chain and origin, and even orders. On product planning, FF automobile said that in the next five years, passenger car planning will include FF 91 series, FF 81 series and FF 71 series. The latter two models are planned to be mass produced and launched in 2023 and 2024. In addition, a “last mile intelligent transport vehicle” (slmd) will be launched in 2023. In terms of supply chain and production layout, FF automobile said that its future production bases will be located in China, the United States and South Korea, including the manufacturing plant in Hanford, California, and “OEM cooperation with a South Korean partner in production and manufacturing, and is striving to make large-scale production in China’s key cities through joint venture.”.
As for orders, FF auto is expected to sell more than 400000 vehicles worldwide in the next five years, and its first flagship model FF 91 has received orders of more than 14000 vehicles worldwide. However, how did ff91 complete these orders without large-scale mass production? It is generally believed that there are still difficulties for ff91 to achieve real mass production, which will also depend on whether FF’s listing and financing can be completed smoothly, and whether the OEM cooperation can be carried out on schedule.
Source: Economic Observer