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November 17, 2018

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Faraday deal result of long push by governor and NLV leaders


Faraday Future

An artist’s rendering of a Faraday Future concept car.

Updated Wednesday, Dec. 9, 2015 | 5:51 p.m.

Sandoval, Faraday News Conference

Dag Reckhorn, left, global vice president of manufacturing for Faraday Future, and Nevada Governor Brian Sandoval applaud during a news conference at the Sawyer State Building in Las Vegas Thursday, Dec. 10, 2015. Reckhorn and the governor discussed plans for the Faraday Future electric-car factory in the city of North Las Vegas. Launch slideshow »

In what could become a major economic boon for the region, Southern Nevada might soon host its own version of Tesla’s electric-car factory — the result of a long behind-the-scenes push by Gov. Brian Sandoval, his staff and the staff of the city of North Las Vegas.

Electric-car startup Faraday Future plans to open its $1 billion factory in North Las Vegas at the sparsely populated, 18,000-acre Apex Industrial Park, Chinese tech billionaire Jia Yueting said in a letter to Nevada legislators obtained by the Associated Press. The state has been in talks over the past few months to bring electric-car startup Faraday Future to North Las Vegas. Nevada was competing with California, Georgia and Louisiana.

Gov. Brian Sandoval is scheduled to hold a news conference at the Grant Sawyer Building in Las Vegas at 11 a.m. Thursday to announce a “major economic development,” during which details of the deal with Faraday are expected to be released.

Sandoval said Tuesday said that a special session of the Legislature would be necessary to approve tax abatements for the company and finalize a deal with Faraday. No such session has been called, though rumors have circulated that one would be called for Dec. 16.

Specific details of the package have yet to be released; they are expected to be modeled after a similar deal approved by the Legislature in September 2014 to bring Tesla’s $5 billion gigafactory to Northern Nevada.

Nevada’s negotiations with Faraday have been shrouded in secrecy for months — similar to company itself. Documents filed with the California secretary of state had suggested a link between Faraday and the Chinese media conglomerate Leshi Internet Information & Technology, known as LeTV. However, Wednesday marks the first time that Jia — the CEO of LeTV who has been called the Chinese Elon Musk, a reference to Tesla’s co-founder — publicly linked himself with Faraday, identifying himself as a founder and investor.

“I am not the only founder of FF,” Jia said in the letter to legislators. “Together with top global experts, we have created a partnership structure for decision making and management of FF.”

Faraday will bring together resources from four “domains” — automotive, technology, Internet and the cloud and entertainment content — Jia said in the letter. The big reveal of Faraday’s concept car is scheduled for the Consumer Electronic Show in Las Vegas in early January, with plans to bring a car to market as early as 2017.

Establishing what could become the next Tesla in Southern Nevada continues to be no easy feat. For city, county and state officials, it meant persuading Faraday to take a leap of faith and come to a dusty, empty plot on the outskirts of North Las Vegas. For Faraday, it means breaking into an industry that Tesla rules and actually bringing a car to market — which many electric-car startups have tried and failed to do.

Efforts to bring an electric-car company to Southern Nevada have been underway since the Legislature OK’d the Tesla package in 2014. Staffers at the city of North Las Vegas pored over the text of that tax-incentive package to find a way to replicate the deal in Southern Nevada.

Officials at the city figured that if the Legislature had already approved the deal for Tesla, a similar deal for another electric-car company in the South could work. Mayor John Lee and other North Las Vegas officials ran through their contact lists to see if anyone they knew had a connection to an electric-car company that would consider opening up shop in the city.

Lee eventually spoke with a friend who connected him with Faraday, headquartered in Los Angeles but looking for a factory site at sites across the country. Faraday had already narrowed down its list of potential locations from more than 200 to 10 by the time North Las Vegas entered the scene. Undeterred, Lee and City Manager Qiong Liu traveled to Los Angeles to try to squeeze North Las Vegas onto that list. Faraday gave them 10 minutes.

Those 10 minutes turned into an hourslong meeting.

“They opened that door. I stuck my hand through it. Dr. Liu put her hand through it. I put my shoulder through it. She put her head through it,” Lee said in September. “We forced our way into that meeting and two hours later we were done.”

North Las Vegas walked away as one of Faraday’s four finalists. The Tesla deal showed that it could be done again for Faraday, and Apex provided an abundance of land and proximity to the company’s headquarters in Los Angeles.

Because much about the car maker has been shrouded in secrecy, Lee traveled to China to tour some of the companies affiliated with Faraday. Once Lee was convinced the company could do what it said it would do, the city turned the deal over to the Governor’s Office of Economic Development to work out the details of what the company would need to whittle that list of four states to one.

Lee said in a statement Wednesday that he looks forward to working with the Legislature and that "This is a transformation opportunity for our community and Faraday is a fantastic company which demonstrates it’s a new day in North Las Vegas.”

The state has stayed relatively quiet during its talks with Faraday, though Sandoval met with Faraday representatives in China this fall.

Steve Hill, state director of economic development, broke his silence in mid-November to confirm that talks with the company were ongoing.

“This is a significant opportunity for Southern Nevada and the state,” Hill said at the Governor’s Office of Economic Development board meeting last month. “We need to be able to perform for them. They need to be able to execute what they say that they will do.”

Around the same time, Faraday also broke its silence, granting interviews to multiple media outlets to talk about the futuristic vision it has for its car. Nick Sampson, the company’s senior vice president of research and development, said in an interview that Faraday’s car will meet users' demands for connectivity — offering a seamless transitions between the operating systems on a customer’s phone, tablet, watch and now, hopefully, car. Their ultimate goal is a fully autonomous car with an Uber-like subscription service, with which a user can order a Faraday car to his or her house for a specific trip.

For North Las Vegas, Faraday could jump-start development at Apex Industrial Park, which has long been plagued by a lack of infrastructure, namely water. Plus, Apex will be home to another futuristic enterprise: Hyperloop Technologies, which announced Tuesday that it will construct an open-air test of a new mode of transportation involving high-speed pods through frictionless tubes at Apex.

The Faraday deal isn’t quite done; it likely won’t be until a special session is called, any tax abatements for Faraday are approved, and the ink from Sandoval’s pen is dry. But Nevada has a shot at establishing itself as the home for electric-car makers.

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