AutoBeta(AutoBeta.net)07/09 Report--

The share price of Faraday Future, an electric car company founded by Jia Yueting, has soared for two weeks in a row, including 36.54% on July 1, 48.73% on July 5, and 21.15% on July 7, reaching a peak of $6.41, quadrupling from a low of $2.20. As of the latest day's close, Faraday closed at $5.40, with a total market capitalization of $1.632 billion.

According to related data, the S & P 500 index fell 20.58% in the first half of 2022, the biggest decline since 1970. Over the same period, the NASDAQ fell 29.51% and the Dow Jones Industrial average fell 15.31%. Among them, new energy vehicle stocks collectively weakened. Tesla fell 36.28% in the first half of the year, Xiaopeng fell 36.94%, and NIO fell 31.44%. Although Faraday fell 51.13% in the next six months, it "ate" all the declines in the first half of the year in just four five trading days, and rose slightly by 1.5%.

Many sources believe that Faraday's future share price surge may be related to the upcoming mass production of FF 91. According to plans previously revealed by Faraday's future officials, the FF 91 will be in mass production in the third quarter of this year and is expected to produce 6000 to 8000 vehicles in 2023. Faraday Future Global CEO Bi Fukang said that the company will adopt a "hybrid production strategy" in car production, the FF91 crossover will be produced at its plant in Hanford, California, and the FF 81 mass market model will be produced by South Korean car contractor MyoungShin.

On the morning of July 22nd, US time, Faraday Future officially listed on the NASDAQ Stock Exchange and held a bell-ringing ceremony to begin official public trading under the stock symbol "FFIE". The offering price of FFIE was $13.78 and closed 1.45% higher on the first day, closing at $13.98, with a total market capitalization of $4.535 billion. However, by the end of the latest day, Faraday had closed at $5.40 and its shares had fallen more than 60 per cent.

On the day Faraday landed on NASDAQ in the future, founder Jia Yueting said in an interview that "we will go all out to achieve 12-month mass production and have great confidence in FF91's on-time production." Now, as the incident looms, officials have once again changed their version from "July" to "third quarter", which means that FF 91 may be postponed to mass production in September, and it is not known whether this target will be changed again.

The mass production of FF 91 is particularly important for Faraday's future, and whether it can be successfully delivered is related to whether it can avoid bankruptcy. Previously, Bi Fukang, chief executive of FF, said in an interview that FF could launch FF91 without additional capital, while the company also said that it would start production in China in the future, and that negotiations were at an early stage. Earlier, Faraday announced a partnership with Geely in the future, but there has been no progress over the past year.

At the same time, since Jia Yueting abandoned Letv and went to the United States to pursue the car dream, it seems that the word "lack of money" has closely followed Jia Yueting, and in order to solve the financial problem, Jia Yueting also found Xu Jiayin of Evergrande, and even in order to solve the debt crisis, he finally sold all his equity to all creditors in the form of personal bankruptcy, but so far, none of these has solved the fundamental problem.

At present, it is still the question of funding that affects Faraday's future. The company reported a net loss of $517 million (3.5 billion yuan) in 2021, compared with a net loss of $147 million over the same period. In the first quarter of this year, the company posted a net loss of about $153 million, compared with a net loss of about $76 million in the same period last year. At the end of the first quarter, FF had only $277 million in cash and cash equivalents. At the current rate of "burning money", FF may not last until the fourth quarter of this year, so mass production of FF 91 will determine whether Faraday will be able to tell the next episode in the future.

FF said that as of the end of the first quarter, the number of FF91 bookings was 401, and it will make every effort to promote the mass production delivery of the first model, the FF91, in the third quarter. It should be noted that mass production and delivery are two different things. In the long history of automobiles, there are numerous cases of suspension of production and bankruptcy of car companies due to too high cost and too little output. Of course, according to FF91 pricing, more or less sales may not be the most important. For Faraday's future, the deeper significance of FF91 mass production is to let investors have confidence in Faraday's future and let the market see hope for survival. However, if FF91 underperforms in the market, what should investors think of Faraday's future?

Of course, FF91 is a high-end flagship new energy vehicle, which forms a misplaced competition with Tesla, Lailai, Xiaopeng and other car companies, and the valuation given to it by the mass production market will naturally be high, so it will be clear whether Jia Yueting can make a complete turnaround in the third quarter.

Jia Yueting once said, "A friend advised me to give up FF, sell my equity and 'hide' in the United States through bankruptcy liquidation, but he still doesn't know me well enough, and giving up and running away will never be an option for me."

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