Faraday Future's Controversial Raises Amid Electric Vehicle Struggles

Faraday Future, a company striving to make its mark in the electric vehicle (EV) industry, has found itself in hot water due to its recent decision to grant substantial raises and bonuses to its CEO and founder. This decision comes at a time when the company has been grappling with financial challenges and has even laid off a majority of its workforce.

• Faraday Future has delivered just 13 EVs in its 10-year history.
• The company recently laid off or furloughed the majority of its employees.
• Faraday Future is under investigation by the Securities and Exchange Commission.

CEO Matthias Aydt's Significant Pay Increase

CEO Matthias Aydt's salary is being bumped from $400,000 to $700,000. He will also receive a $500,000 "recognition bonus", an "annual discretionary target bonus" of $700,000, and two annual stock grants worth more than $4 million.

Founder Jia Yueting's Lucrative Package

Founder Jia Yueting's salary is increasing from $450,000 to $680,000. He is also receiving a $500,000 recognition bonus, an annual discretionary target bonus of $816,000, and two annual stock grants worth more than $4 million.

Financial Challenges Facing Faraday Future

Despite the generous raises and bonuses, Faraday Future has been struggling financially. The company ended the second quarter of 2022 with only $793,000 in unrestricted cash. It secured $22.5 million in new financing commitments, but it's clear that the company is facing significant financial challenges.

Limited EV Sales and Allegations of Faked Sales

Faraday Future has sold very few EVs to date, and in a pair of whistleblower lawsuits, it was accused of faking some of its sales. Although the company has disputed these claims, it admitted in regulatory filings that a third employee has come forward. These allegations further damage the company's reputation in the already competitive EV market.

Faraday Future's Financial Struggles Impact Employees

While the CEO and founder are receiving substantial raises and bonuses, the company has laid off or furloughed hundreds of employees and those who remain are working on drastically reduced salaries. Faraday Future was almost evicted from its Los Angeles headquarters in February 2024 but was able to reach an agreement with the property owner.

Conditions for the Raises and Bonuses

There are some conditions attached to the raises and bonuses. Aydt and Jia will be paid prorated base salaries of $550,000 and $612,000, respectively, and they must agree to spend at least $340,000 of that money on buying company stock. They will only receive the rest of their raises if and when the company restores the full salaries of all other employees. The one-time bonuses will be paid out in chunks, with each of them receiving 25% of the money on September 30, another 25% on October 31, and the remainder on the earlier of September 30, 2025, or the completion of a funding round greater than $30 million.

Faraday Future's Future

Faraday Future's future remains uncertain. Despite the challenges, the company is determined to succeed in the electric vehicle (EV) market. The company has secured new funding commitments and is working to restore the full salaries of its employees. Whether it can overcome its financial difficulties and achieve its goals in the highly competitive EV industry remains to be seen. The company did not immediately respond to a request for comment.