The Chinese EV-holding LeEco, which is behind a wide spread net of companies in the media, sports, TV, and electric vehicle industry, is in financial troubles. The co-founder and billionaire Jia Yueting had to admit in a letter to his shareholders that the company has to cut costs.
In the past months LeEco financed credits with its shares to fund ambitious projects such as the LeSee or Faraday Future. The company was founded in 2004 as Leshi Internet Information & Technology and grew rapidly, making Yueting a self-made-billionaire. With the aggressive expansion and suffering from recent stagnation in other branches of the business the share prices have dropped a third since the beginning of 2016. The shares are listed at the Shenzhen Stock Exchange, and the price drop made creditors and share holders nervous. This shaky situation also resulted in the treasurer of Nevada rejecting issuing bonds to construct a car factory.
Only recently both Faraday Future and LeSee have revealed their visions for electric vehicles. And in September a chinese group of investors raised one billion dollars for LeSee. Faraday Future is also well financed with over one billion.
How much the money troubles will affect the ambitions of the electric vehicle manufactures is to be seen. At the same time their competition – of which there are quite a lot coming from China as well – is not waiting.