(Yicai Global) Oct. 31 -- Troubled Faraday Future, the Chinese electric car startup locked in dispute with its main investor, has lost a second co-founder just as recent hires are furloughed and 500 essential staff struggle on to mass produce and deliver its first vehicle before year-end.

The departure of Nick Sampson, who was also senior vice president of product strategy, comes a day after that of Peter Savagian, senior vice president of technology and product development, US tech news outlet The Verge reported today. It was Sampson who hosted the launch of the company's FF 91 model in January last year.

The company told Chinese state media The Paper that most employees who started on or after May 1 will go on unpaid leave this month and next, while those who joined earlier will work on trimmed wages. The furlough is expected to last until December's end, but its actual span will depend on funding. All staff will continue to receive healthcare benefits as before.

Remaining founder and Chinese billionaire Jia Yueting has cut his annual salary to USD1.

Despite ambitions to become China's Tesla, Faraday Future says it is undergoing "extraordinary financial hardship." The firm fell out with white knight investor Evergrande Health Industry Group, which brought USD2 billion to the table, after the automaker claimed Evergrande Group unit flunked on a payment it should have settled in July, while Evergrande says Faraday did not meet the requirements outlined for the advance. The dispute landed in the lap of the Hong Kong International Arbitration Centre.

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The carmaker is on the brink of bankruptcy in its current financial state. The arbitration panel recently allowed it to raise funds of up to USD500 million under strict conditions against the objections of Shenzhen-based Evergrande Group, Yicai Global reported on Oct. 26. An USD800 million lifeline was used up in the past six months. If no new funds become available, operations will be unsustainable, so a new investor must be found to get cars rolling off the assembly line before the year is out.

Faraday will find it difficult to raise new funds since Evergrande is still the main shareholder, insiders said. Though arbitration offers a glimmer of hope for future financing, few companies will be willing to extend funds under such strict conditions, they added.

Last week's layoffs and salary cuts did not help Faraday meet its monthly USD10 million payroll, so management shut down some departments at the firm's base in Hanford in southern California's San Joaquin Valley, and will temporarily close its factory there. Workers will also go on unpaid leave until new funding is forthcoming, The Verge reported.

FF also takes its relations with suppliers seriously and requests the support and understanding of its global partners in its temporary financial straits, the company added. The firm thanks all 500 staff willing to stay, above all the engineering research and development and production teams continuing work on the FF 91, as well as those on temporary leave.

Employees starting before May 1 who chose to stay will draw a salary reduced to USD50,000 a year and hourly workers on the job for over six months can choose to stay on for minimum wage, per the report.

Editor: Ben Armour