HONG KONG -- After China's third-richest man backed entrepreneur Jia Yueting's electric-vehicle startup with a $2 billion funding pledge, the wheels finally started turning at its plant in Hanford, Calif.
The once-abandoned factory came to life three years after Faraday Future executives visited the farm town to scout the location. Between plant visits from a state senator and local officials, Jia started building his team. He hired plant workers, Tesla Inc.'s former head of intellectual property and litigation, and even the city's former mayor.
"Vehicles are being assembled as I type!" Hanford's city manager, Darrel Pyle, said in an email in August.
The zest didn't last long, as the new backer for the Chinese challenger to Tesla is now pumping the brakes. In an Oct. 7 filing, billionaire Hui Ka Yan's Evergrande Health said it engaged lawyers to defend the company's interests after Jia began arbitration on Oct. 3 at the Hong Kong International Arbitration Centre. Jia's company alleges that following Evergrande Health's initial $800 million investment, it failed to inject additional funds into the business after Jia fulfilled the required conditions, according to a statement posted on Faraday's Twitter account.
Faraday wants to scrap the deal because Evergrande not only is withholding payments in a bid to allegedly get Faraday's intellectual property, but it's also preventing Faraday from accepting immediate financing from other sources, the Twitter posting said. Evergrande Health denied the claim.