FF mass-produced cars to save LeEco from car crisis: money is the most critical issue

LeEco, which is at the center of controversy due to funding and other issues, is trying to turn the tide of public opinion. On the afternoon of December 11, LeEco founder Jia Yueting released a video at the China Business Leaders Annual Conference showing the mass-produced car of its strategic partner FF racing against supercars such as the Ferrari 488GTB, Tesla Model X and Bentley Bentayga, and hinted that its mass-produced car far exceeds all of the above models in acceleration performance, hoping to strengthen the confidence of the industry.

However, even so, the industry still has doubts about LeEco Auto. Acceleration performance is only a key indicator for considering the power performance of the whole vehicle, not the only one. At the same time, although according to official statements, this car is expected to be mass-produced next year. However, according to multiple media reports, FF's factory has not been completed yet, and its construction will not start until next year. In this context, how can mass production be achieved? In addition, even if FF's mass-produced car has forward-looking and outstanding features in technology and performance, how much can LeSEE, a subsidiary of LeEco Auto, benefit from it? It remains to be considered. More importantly, it is difficult to draw a conclusion at present whether LeEco, which is in a financial crisis, can continue to obtain external financial support to smoothly support the development of its automotive business.

FF's first mass-produced car, which will be released at the CES in Las Vegas on January 3, seems to have become the most important proof for Jia Yueting and LeTV to prove their strength.

In the video a few days ago, it seemed to imply that the acceleration performance of this car will exceed that of the Ferrari 488GTB. Today, the media further reported that this will be a high-end luxury model that surpasses Tesla in terms of luxury and intelligence. Its price after mass production may reach 200,000 US dollars, and it is even positioned in the same market as Bentley and Ferrari.

LeEco is not the only company that uses super luxury sports cars to prove its technological strength. Prior to this, another domestic electric car startup, NIO, also released its first electric sports car overseas. Its acceleration performance, which surpasses that of electric sports cars of the same level, is also a very key indicator of its own technology and R&D strength.

(Spy photos of FF production car circulated online)

Although acceleration performance is not the only indicator to consider vehicle performance, it is not easy for a new entrant to achieve a breakthrough in such a key data in a short period of time in the industry.

According to a Sina Technology reporter who was invited to visit FF's R&D center in the United States, FF executives recently revealed that FF's batteries, electronic controls, interconnection, vehicle networking, and intelligent driving systems are indeed all made by itself, even including motors, and will achieve breakthroughs in indicators such as battery energy density and maximum acceleration. The executive also revealed that FF has currently applied for more than 200 patents to the U.S. Patent Office, and more than 10 have been approved.

The "three-electric" system, including batteries, motors, and electronic controls, is a very critical and core technology in electric vehicles. Its importance is similar to that of traditional car powertrains such as engines and gearboxes. If what FF's senior officials said is true, then FF does have some remarkable technical capabilities. However, what does this have to do with Jia Yueting and LeEco Auto?

Founded in 2014 in California, FF (Faraday Future) is an electric car startup. Like in China, there are actually many such electric car startups in the United States. Of course, they will naturally face life and death elimination. However, this company has grown by poaching traditional car companies on the one hand and attracting investment on the other. In 2015, it received personal investment from Jia Yueting and became a strategic partner of LeTV Auto.

Jia Yueting chose this company for a reason. According to data, FF currently has more than 1,400 employees, including nearly 1,100 R&D personnel. Its core technical team includes not only employees from Tesla, but also people who have worked for many years in auto giants such as Jaguar, BMW, Audi, and Lamborghini. In addition, employees of consumer electronics and Internet giants such as Apple and Hulu are also included. From the perspective of team building, the strength of the personnel recruited by FF is still very strong. Perhaps because of this, the LeTV team is very proud to say that the key indicators of FF cars have surpassed Tesla.

Even though FF's mass-produced cars have reached a new height in terms of technical strength, FF is not LeEco Auto after all. Can LeEco Auto's own LeSEE really bring a subversive experience to the industry as Jia Yueting said?

Although LeSEE has appeared in public twice, in fact, the industry knows very little about the car's core technical parameters except that it will be equipped with high-tech features such as autonomous driving and other recognition technologies.

Ding Lei, co-founder and global vice chairman of LeTV Supercar, said in an interview with the media that since FF and LeTV Supercar are strategic partners, LeTV Supercar will carry out comprehensive and in-depth cooperation with FF in factory construction and automobile manufacturing, including product design, technology research and development, etc.

From this perspective, if FF's mass-produced vehicles can be successfully put into production and gain recognition in the industry, then at least in terms of technology research and development, we will have greater confidence in the future of LeSEE.

There is less than a month until the FF mass production car is unveiled, but from the current point of view, LeEco and FF are not ready for the production of this new car. Due to the adjustment of the plan caused by funding issues, the factory will not officially start construction until early next year. So when it can really enter the market next depends on the financial support of LeEco.

Funding issues to be resolved

Funding is the most direct and critical problem LeEco is currently facing. According to a report from Caijing, Jia Yueting said in an interview that LeEco has invested "15 to 6 billion" in its automotive business, and that to achieve mass production, the total investment will be "at least 40 to 50 billion." This means that LeEco still needs to invest 24 to 35 billion yuan in its automotive business.

Although LeEco has spent 279 million yuan to acquire land in Deqing County, Zhejiang Province a few days ago to promote the Moganshan car project, and there are reports that the supporting roads for the Moganshan project have been built, the reality is that LeEco does not have such a large amount of funds to invest in the car business. The mass production of LeSEE will still be uncertain.

The "crisis" of LeEco Auto is attributed by the industry to Jia Yueting's strategic and investment dispersion. Judging from the amount of money invested alone, LeEco has indeed spent a lot of money on cars compared to other start-ups. Jia Yueting once publicly stated that his investment has reached more than 10 billion yuan. The companies that have received his investment include not only electric vehicle start-ups (in addition to FF, Jia Yueting also invested in a company in the United States formerly named Atieva, which was later renamed Lucid Motors), but also charging pile companies in the electric vehicle ecosystem, car sharing projects (Yidao Yongche), and the establishment of an electric vehicle time-sharing rental company (Lingpai Lexiang).

Jia Yueting has great ambitions. He has always emphasized the ecological model and hopes to use cars as a medium to create a closed loop in many aspects such as the Internet, content, applications, cloud, and Internet of Vehicles architecture and systems. At the same time, he also wants to get involved in areas such as automobile manufacturing, use, and travel to build a large closed loop.

His idea is not wrong. The startups currently involved in Internet car manufacturing are not looking for the meager profits from vehicle manufacturing, but are more concerned with the car as a medium, the intelligence behind it, and the business opportunities in the areas of car interconnection and sharing.

However, the automobile industry is an industry with very high asset and technology barriers, and the risks and challenges of taking on all of it are huge. In fact, most Internet car-making companies are basically following the path of traditional car manufacturers, first making a marketable car, and then talking about business expansion and possibilities in the industrial chain. This is different from LeEco's model of investing widely and hoping to drive multiple links at the same time. Moreover, LeEco itself is not familiar with the operation of each link in the automotive industry chain, which poses certain risks and challenges.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.