LeEco’s US chief says no layoffs as self driving car plan a ‘high priority’
Chinese technology giant LeEco has no plans to lay off its US staff or abandon its self-driving car ambitions, a senior executive said on Tuesday.
Brian Hui, head of LeEco’s North American operations, said he doesn’t expect layoffs on LeEco’s US team, which has grown from 30 to nearly 600 people over the course of the year.
His remarks came after the release of an internal letter written by the company’s founder Jia Yueting, who said the rapid expansion overseas and in many product directions had seen the high-flying company become cash-strapped.
Last month, LeEco made an aggressive push in the US market with the launch of a slew of hardware products including television sets and smartphones.
LeEco is known for its global ambitions, which include a grand plan to develop self-driving electric cars under its own brand LeSee and a separate partnership with US carmaker Faraday Future.
Jia said in the letter circulated on Sunday that the car business investment alone has surpassed 10 billion yuan (HK$11.4 billion), and consequently he didn’t have enough cash to support LeEco.
The letter prompted discussions on whether LeEco may abandon its electric car plan which has already burned through a huge amount of cash.
But Hui said LeEco will not give up the self-driving car plan which is a “high priority”.
“If you read the letter, it’s not about whether it’s sustainable or not sustainable,” Hui said of LeEco’s growth. “It’s not about running out of money. It’s how you can spend your money wisely,” he said at the TechCrunch Beijing forum.
Hui also refuted rumours that LeEco had defaulted on payments to suppliers. “We still maintain very good relationships with [the suppliers],” he said. “We will always want to sustain our trust.”
Share prices in LeEco’s listed entities stabilised on Tuesday, after the default rumours and Jia’s letter triggered the stocks to plummet.
Shenzhen-listed Leshi Internet Information & Technology rose 3.01 per cent on Tuesday to close at 38.99 yuan, after losing nearly 5 per cent the previous day. Coolpad, the Hong Kong-listed smartphone unit of LeEco, edged down 0.93 per cent to close at HK$1.07, after a nearly 18 per cent decline on the previous trading day.