Why Faraday Future Intelligent Electric Stock Fell Nearly 14% Today

Shares of Faraday Future Intelligent Electric (NASDAQ: FFIE) were down by 13.6% as of 1 p.m. ET Wednesday. That plunge followed a session that saw shares of the start-up electric vehicle (EV) maker surge by more than 50%, though there was no fresh news about it Tuesday. Apparently, the meme stock crowd has taken control of this stock.

Upstart EV companies capitalized on the stock market boom of 2020 and 2021, but they have since fallen on hard times. Manufacturing vehicles is an incredibly capital-intensive business, and these companies have already burned through billions of dollars in their efforts to get their operations up and running at scale. Not all will succeed. For example, would-be electric truck maker Electric Last Mile Solutions filed for bankruptcy in June.

Some investors think Faraday Future is headed in that direction as well. As of the end of March, it was down to just $276 million in cash and short-term investments on the books after generating negative free cash flow of $167 million in the first quarter. With the first production models of its FF 91 not due to roll off the assembly line until the third quarter of this year, there's a possibility Faraday Future will run out of money sooner rather than later.

Source Fool.com