Faraday ‘adjusts’ construction schedule at Apex, contractor says
The general contractor overseeing construction of the Faraday Future electric car manufacturing plant in North Las Vegas said the manufacturer has “temporarily adjusted” its construction schedule with plans for resuming work early next year.
In a statement to the Review-Journal, AECOM said, “Faraday Future commenced work on its $1 billion state-of-the-art manufacturing facility in North Las Vegas earlier this year. To date, we have completed grading and foundation prep work. At this time, Faraday Future is temporarily adjusting their construction schedule with plans to resume in early 2017. We remain fully committed to our client and our employees working on this project, and we look forward to the facility’s successful delivery.”
Upon issuing the statement on Saturday, an AECOM representative referred all further correspondence to Faraday Future. Faraday has not responded to telephone and email inquiries from the Review-Journal. An operator of Faraday’s official Facebook page referred the Review-Journal to the same email address that thus far has not responded.
This announcement comes amid concerns that Faraday Future is facing financial problems that could jeopardize construction of the plant at Apex Industrial Park.
“We’re increasingly more concerned than we were before that this is just a big Ponzi scheme,” Nevada Treasurer Dan Schwartz told the Review-Journal for a recent story.
Schwartz called out Faraday’s relationship with Chinese backer Jia Yueting as appearing nefarious for ways the mysterious billionaire has been shifting money around at a time when Faraday had fallen short on more than $57 million in payments that were due to an escrow account for AECOM to pay contractors.
“I’m being very literal when I say Jia personally does not have the cash,” Schwartz said.
Schwartz suggested Gov. Brian Sandoval and Steve Hill, executive director of the Governor’s Office of Economic Development, might have been too hasty to extend benefits to Faraday.
“The state of Nevada got behind this project, and no one’s seen any financials,” Schwartz said.
Sandoval said Monday he is concerned about reports that Faraday Future is facing financial difficulties and met with Hill to discuss reports that the company was behind in deposits to the escrow account.
“Yes, I am concerned about that,” he said when asked about the company’s apparent financial issues.
But Sandoval noted that the state has protections in place to ensure there are no financial consequences should the project not be completed.
Sandoval also said he personally visited the Apex site recently and that the grading work for the pad was close to being complete.
“My understanding is that they have invested tens of millions of dollars in grading and that it is close to completion to prepare the pad for the construction of the factory,” he said. “So I think that is a pretty substantial investment.”
Legislation providing tax incentives to Faraday require the $1 billion investment before the company receives any abatements, he said. It also requires a security bond before any bonding is approved by the state, Sandoval said.
As chairman of the state Board of Finance, which will have final approval of any bonding, Sandoval said: “I will be front and center to ensure that Faraday has done everything that they said they will do and that they are supposed to do as required by state law.”
While the plant is important for Nevada’s economic diversification efforts, the special session in 2015 to bring Faraday to the state also focused on the infrastructure needed to prepare the Apex industrial area for development of all types, he said.
Also on Monday, Sandoval called for possibly delaying a $70 million highway improvement project that would improve access to the Apex Industrial Park in North Las Vegas.
“I’m not trying to convey that I’m concerned in any way because it looks to me that everything is progressing as it should,” Sandoval said. “But I just don’t want the state to get out too far and be consistent with what’s going on out there.”
Last December, the state Legislature approved a $320 million incentive package to bring Faraday Future to Southern Nevada, including a series of tax breaks, improvements and road projects.
Construction is scheduled to begin in June on a project that calls for widening U.S. Highway 93 for five miles, from Interstate 15 to Apex Power Parkway. The $70 million project also calls for building frontage roads and a channel that would divert stormwater from the raw chunk of land around Apex.
NDOT officials must now determine a new timeline for the project. In the meantime, four prequalified design companies have until Dec. 13 to submit their bids and proposals to complete the project, NDOT spokesman Tony Illia said.
“Everyone has been keeping tabs on the funding situation with Faraday Future, and certainly we were concerned about that,” Illia said. “We take direction from the state transportation board, and if they tell us to prioritize this project, then that’s what we will do. If he (Sandoval) wants us to slow that down, then that’s something we’ll work out.”
Review-Journal writers Art Marroquin and Sean Whaley contributed to this report.
CORRECTION: This story has been updated to reflect that the highway widening project would affect U.S. Highway 93.
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