Faraday Future's Last Founding Executive Resigns, Plans Emergency Fund For Employees (theverge.com) 34
Faraday Future, the startup that is working on a luxury self-driving electric car that looks to rival Tesla, is facing some management and investment issues. All five of the company's "founding executives" have resigned. The latest is Dag Reckhorn, Faraday Future's senior vice president of global manufacturing. "The news comes after investor trouble sparked two wild weeks of layoffs and salary cuts that quickly turned into furloughs and executive departures at the EV startup, and a co-founder calling the company 'effectively insolvent,'" reports The Verge. "Reckhorn said in his email to staff that he is working to establish an emergency fund for employees affected by the furlough." From the report: "I am heartbroken to have to let you know, that I will leave FF effective today," Reckhorn wrote in the email, which was sent to the company's remaining staff. "There are legalities that force me to do so. Please do not believe that I am ditching the best team I ever worked with." Faraday Future spokesperson John Schilling confirmed Reckhorn's resignation. "We thank him for his service to FF and wish him the best of luck in his future endeavors," he said.
Reckhorn mentioned in the email that he is "think[ing] about opening an emergency fund" for employees in "dire needs" as a result of the furlough, and that he's putting in $10,000 to start. "Other colleagues are free to join and donate as well," he wrote. The hope is to "help [employees] as best as the available funds allow." Before the layoffs and furloughs, Faraday Future still had around 1,000 employees in the US. Following a now-prolonged fight with its main investor, China's Evergrande Real Estate Group, Faraday Future announced the furloughs (or forced unpaid leave) to employees on Tuesday. All workers who joined the company after May 1st of 2018 were automatically furloughed, while full-time employees who have been with Faraday Future since before that date were given the opportunity to stay on board at a reduced salary rate of $50,000 per year. Hourly employees who joined Faraday Future before May 1st were given the opportunity to stay on at $13.25 per hour. The "legalities" Reckhorn mentioned have to do with what's known as "director and operator insurance (or D&O insurance)." According to The Verge, citing two former employees, "D&O is a type of liability insurance that protects a company's directors and operators from legal retribution in the event of a lawsuit."
Reckhorn mentioned in the email that he is "think[ing] about opening an emergency fund" for employees in "dire needs" as a result of the furlough, and that he's putting in $10,000 to start. "Other colleagues are free to join and donate as well," he wrote. The hope is to "help [employees] as best as the available funds allow." Before the layoffs and furloughs, Faraday Future still had around 1,000 employees in the US. Following a now-prolonged fight with its main investor, China's Evergrande Real Estate Group, Faraday Future announced the furloughs (or forced unpaid leave) to employees on Tuesday. All workers who joined the company after May 1st of 2018 were automatically furloughed, while full-time employees who have been with Faraday Future since before that date were given the opportunity to stay on board at a reduced salary rate of $50,000 per year. Hourly employees who joined Faraday Future before May 1st were given the opportunity to stay on at $13.25 per hour. The "legalities" Reckhorn mentioned have to do with what's known as "director and operator insurance (or D&O insurance)." According to The Verge, citing two former employees, "D&O is a type of liability insurance that protects a company's directors and operators from legal retribution in the event of a lawsuit."
Electrical Engineering 101 for the shorts. (Score:1)
There are TWO battery car companies named after these inventors. Short the DC motor inventor, not the AC motor inventor.
It is easy to remember: AC and DC duked it out at the turn of the 20th century. DC promoted by Edison and Genelec lost and AC promoted by Westinghouse won. Remember that to know which one to short and which one to long. ok?
Authentic Frontier Gibberish (Score:5, Funny)
Now who can argue with that? I think we're all indebted to 140Mandak262Jamuna for clearly stating what needed to be said. I'm particulary glad that these lovely children were here today to hear that speech. Not only was it authentic frontier gibberish, it expressed a courage little seen in this day and age.
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Was always a scam (Score:2)
"I know, let's name our competing company Edison, no Faraday! And sell penny stocks to suburban rubes!"
>> $10k for 1000 employees
Thanks, that's enough for a buritto at a shitty chain like Chipotle minus drink out here in the sticks. I'll bet $10 goes even further in Silicon Valley.
One investor? (Score:2)
One investor is always a bad move, especially if that one investor wants to control your capitol with an eyedropper. Might as well have a boss.
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Very short budget horizons.
Oh please (Score:2)
director and operator insurance eh? (Score:2)
The "legalities" Reckhorn mentioned have to do with what's known as "director and operator insurance (or D&O insurance)." According to The Verge, citing two former employees, "D&O is a type of liability insurance that protects a company's directors and operators from legal retribution in the event of a lawsuit."
I'm betting that they could no longer get this type of insurance, so they're leaving before they get personally sued. I sure wouldn't want to stay and be potentially personally liable for anything that the company gets sued for.
Yes, shareholder lawsuits (Score:2)
I'm pretty sure you're right. When a company goes under, investors frequently sue the directors and officers, claiming that they did something questionable or even just stupid. Frequently those suits are unsuccessful, but defending yourself from such a suit is very expensive.
D&O insurance covers the cost of defending the officers and directors, unless they:
Did something illegal (ie a crime)
Fail to disclose conflicts of interest
Breach their duties to the company or shareholders
Make personal use of busin
More pie for Musk (Score:2)
It's too bad, but if you looked at the cars between the two companies Tesla not only had much better design, but also way more realistic to produce cars.
At some point there is probably a place for some exotic electric supercar but there I have my money placed more on the truly high end car makers than an upstart - though even there Tesla might do something that would gain traction.
Tesla, Volt, Faraday... (Score:2)
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It seems they are going overboard with originality when it comes to naming. Are the next electric car companies going to get named Coulomb or Ampere ?
Ampere is already taken. https://www.amperemotor.com/ [amperemotor.com]
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Dodged that bullet (Score:1)