Over the past few months, things appeared to be out of control at the high-profile electric car startup Faraday Future. The new leadership brought in by billionaire founder Jia Yueting, including Stefan Krause, former BMW and Deutsche Bank CFO, and BMW’s head of EVs, Ulrich Kranz, along with several other high-profile employees, left in masses.
Now, sources have told Electrek that those same Faraday Future expats are launching their own electric car startup.
The circumstance surrounding this new startup is apparently directly linked to Krause’s departure from FF.
As we previously reported, the longtime financial exec was brought on board to straighten up the company’s finances, but sources say that he faced important roadblocks from FF founder Jia Yueting, also known as YT.
YT was better known as the founder of LeEco, a Chinese tech giant, but as the company’s financial troubles got out of control over the last year, YT had to resign from his leading role at the company and instead moved to California to focus on Faraday Future, which is still under his control.
Earlier this month, YT’s profile in China was hit even harder when the government placed him on a debt blacklist, which is a way to shame affluent Chinese business people and block them from engaging in reckless spending.
With his position in China growing weaker, it looked like YT turned to his US EV startup to build his empire back up.
That’s while Krause was trying to raise money for the company in order to bring its first vehicle, the FF91, to production.
But sources say that while Krause made some progress to raise capital, deals fell through because they were contingent on YT resigning or giving up a controlling part in the company, which is something he refused to do.
Last month, FF sent out a press release announcing that they terminated Krause’s employment and they were looking into legal actions against him:
“Stefan Krause’s possible violation of law and lack of contribution to FF’s goals over the course of his leadership since March has led to severe damages to the interests of FF and its investors. FF is currently taking legal actions as a result of Stefan Krause’s malfeasance and dereliction of duty.”
At the time, Krause responded by stating that his employment wasn’t terminated and that he had instead quit a month earlier.
Now, sources have told Electrek that he launched his own electric car startup called ‘EVELOZCITY’.
The startup has now a very simple website online with the following “vision”:
“Design, develop and deliver the most competitive, capable, connected and clean mobility device for the next generation.”
Sources say that he was able to raise funds using the groundwork that he had done on the previous deals that he tried to close for FF, but that ended up failing due to disagreements with YT.
With a reportedly significant financial backing and preferring Krause’s leadership over YT’s, sources say that several high-profile Faraday Future executives and employees are following Krause to EVELOZCITY and that more could come.
We are told that Richard Kim, FF’s former head designer, Bill Strickland, a former Ford executive who joined FF last year to lead its vehicle line, and Sohel Merchant, a former Tesla engineer who led vehicle engineering at FF, all joined the new startup.
We reached out to the company for a comment on the founding of their new startup. We will update if we get an answer.
On the other hand, now YT claims to have managed to raise $1 billion for FF despite his financial troubles – though it’s still unconfirmed at this point.
The world of EV startups is starting to get crazy and FF was its poster child for a while. Not so much anymore.
As we reported last month when FF seemed close to its last breath, even though the company has been in financial trouble for the better part of the last 2 years, its 1,000+ employees haven’t been sitting on their hands during that time and have developed some interesting EV technologies showcased in the FF91.
While the company might never deliver anything, hopefully, their work on the FF91 leads to something.
But there’s also one other thing that we always admired about FF: the company’s ability to attract top talent.
Now, it looks like EVELOZCITY is going to be where some of that talent is going to end up. Stay tuned to Electrek as we follow their progress.
FTC: We use income earning auto affiliate links. More.