Nevada treasurer Dan Schwartz has expressed his concern about the funding of start-up electric automaker Faraday Future.
While speaking with Bloomberg, Schwartz pinpointed his caution at Jia Yueting, a self-made billionaire who owns the prospective Tesla rival. Schwartz remains unconvinced that Yueting can secure the necessary funding to build the company’s proposed $1 billion factory in Nevada.
Yueting relies heavily on equity-backed loans and Schwartz is worried that this financing strategy could hurt local taxpayers due to the volatility of the Chinese stock market. Compounding this is the fact that the stock price of Yueting’s main company, Leshi Internet Information & Technology Corp, has dropped 11 per cent since trading of it resumed on June 3, after a five-month trading halt at the start of the year.
Schwartz told Bloomberg “You can see where this leads. His Internet company is successful, but that doesn’t generate the billions of dollars he’d need. Where’s he going to get the money?’’
Schwartz’s concerns are understandable as he will be the man to sign off on state bonds for $120 million worth of power lines, water mains, roads and other infrastructure improvements around Faraday’s factory.
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