TMC is an independent, primarily volunteer organization that relies on ad revenue to cover its operating costs. Please consider whitelisting TMC on your ad blocker and becoming a Supporting Member. For more info: Support TMC

Faraday Future called a Ponzi scheme

Discussion in 'Electric Vehicles' started by voyager, Nov 16, 2016.

  1. voyager

    voyager Member

    Joined:
    Apr 28, 2009
    Messages:
    555
    Location:
    Amsterdam, Netherlands
    Faraday Future has stopped construction on its billion-dollar electric vehicle factory in Las Vegas. This is another blow against a company with intentionally foggy structuring, mysterious revenue sourcing, and an financially overburdened parent company. Nevada State Treasurer Dan Schwartz, and probably anyone else who has been following this story, is a little less optimistic. “This is a Ponzi scheme,” he said in an interview with Forbes. “You have a new company that has never built a car, building a new plant in the middle of the desert, financed by a mysterious Chinese billionaire. At some point, as with Bernie Madoff, the game ends.” The state of Nevada had agreed to provide more than $200 million in incentives, as the EV factory was expected to create 4,500 local jobs.

    Automotive Startup Faraday Future Just Became a Shutdown
     
  2. green1

    green1 Active Member

    Joined:
    Mar 25, 2014
    Messages:
    4,548
    Location:
    Calgary, Alberta, Canada
    Ponzi scheme is awfully harsh.

    Failed business, most likely, Ponzi scheme, I doubt it. A Ponzi scheme is where, with no intention of running a real business, you use the money from later investors to provide returns to early investors until the whole thing collapses under it's own weight.

    This is just a flailing business with no direction or vision that spent money like a druken sailor and will eventually run out. We saw a lot of this in the "dot com bubble" and now we have the EV version of the same thing.
     
  3. ecarfan

    ecarfan Well-Known Member

    Joined:
    Sep 21, 2013
    Messages:
    12,567
    Location:
    San Mateo, CA
    At least he is not accusing Musk of being Madoff like the silly article linked to in this thread does: Elon Musk the next Bernie madoff?
     
  4. hockeythug

    hockeythug Active Member

    Joined:
    Jun 3, 2013
    Messages:
    1,878
    Location:
    Minnesota
    At least Nevada isn't really on the hook for anything as Faraday actually has to build the thing to get the tax incentives. Same with Tesla.
     

Share This Page