LAS VEGAS (Bloomberg) -- Faraday Future, the electric-vehicle startup backed by Chinese billionaire Jia Yueting, has chosen Nevada for the company’s planned $1 billion U.S. factory.
"We hope to bring our $1 billion investment to North Las Vegas and our open our first manufacturing facility there, creating 4,500 jobs," Jia said in a letter to Nevada’s legislature.
Though automakers have struggled to find profits with electric models, Faraday has said it aims to make money not just on the vehicles but on subscriptions for applications and infotainment piped into the car. The company plans to introduce its first car in 2017, after unveiling a concept next month at the CES electronics show in Las Vegas.
Yueting is founder and chairman of Leshi Television, a Chinese online video site.
The plant is another coup for Nevada, which is eager to diversify its tourism-dependent economy and expand in manufacturing. Tesla Motors Inc. is building the world’s largest lithium-ion battery factory east of Reno and has said it expects to spend $10 billion over 10 years.
Faraday spokeswoman Stacy Morris said last month that the company also was considering sites in California, Georgia and Louisiana.
Separately, Nevada Governor Brian Sandoval will hold a press conference Thursday morning in Las Vegas with Steve Hill, director of the state’s Office of Economic Development. Sandoval will probably have to convene a special session of the legislature to approve any tax incentives.
Faraday hasn’t revealed the name of its chief executive officer or identified its battery supplier. The company is the latest Chinese-backed startup to begin work on electric cars in the U.S. Along with Karma Automotive LLC and Atieva, Faraday has launched operations in the U.S. to take advantage of the country’s engineering and design knowledge, even as American consumers increasingly buy SUVs, crossovers and pickups thanks to cheap gasoline.
The company, which has said it expects to have 500 workers by the end of this year, has hired about 60 former Tesla employees, according to their profiles on LinkedIn. Nick Sampson, senior vice president of r&d and engineering, and Dag Reckhorn, vice president of global manufacturing, both worked at Tesla. Faraday’s lead designer is Richard Kim, a veteran of BMW.
In 2014, Sandoval convened a special session to approve tax incentives worth $1.25 billion for Tesla’s Reno factory. That legislation didn’t name Tesla specifically but applied only to companies that invest at least $3.5 billion in the state over 10 years. Faraday Future’s $1 billion factory wouldn’t qualify.
The factory would cement a turnaround for North Las Vegas, which was one of the country’s fastest-growing cities in the 2000s before the housing-market collapse nearly pushed it into insolvency. Its city council declared a fiscal emergency in 2012 and state officials considered putting the city into receivership.
North Las Vegas has been courting Faraday for its Apex Industrial Park, where medical marijuana growers have helped transform 2,000 acres of vacant desert into a site with water and power lines suitable for development. Faraday would be the first industrial user on the site.
One marijuana grower currently operates on the site while 15 others are in various stages of permitting.