Faraday Future: A second electric car factory in the Bay Area?

A driver walks in front of the FFZero1 by Faraday Future at CES Unveiled, a media preview event for CES International Monday, Jan. 4, 2016, in Las Vegas. The high-performance electric concept car was unveiled during a news conference by Faraday Future. less A driver walks in front of the FFZero1 by Faraday Future at CES Unveiled, a media preview event for CES International Monday, Jan. 4, 2016, in Las Vegas. The high-performance electric concept car was unveiled ... more Photo: Gregory Bull, Associated Press Photo: Gregory Bull, Associated Press Image 1 of / 17 Caption Close Faraday Future: A second electric car factory in the Bay Area? 1 / 17 Back to Gallery

Electric car startup Faraday Future, often touted as a potential rival to Tesla Motors, wants to build an auto factory in Tesla’s Bay Area backyard.

Faraday, based in Los Angeles, has been in discussions with Vallejo officials to build a factory on the former Mare Island naval base, the city reported Tuesday. Vallejo has been trying to redevelop the base since it closed in 1996.

At a special meeting on May 31, the Vallejo City Council will decide whether to enter exclusive negotiations with Faraday over 157 acres on the island’s northeastern end, sandwiched between the Mare Island Causeway Bridge and Highway 37.

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“The built-in employment base we have here in Vallejo is a perfect fit for Faraday,” Andrea Ouse, the city’s economic development director, said in an interview. “This is the first step in what we hope will be a long future with Faraday.”

Faraday formed just two years ago and, so far, has shown the public only a concept car. But the company has already hired about 960 people and recently broke ground on a $1 billion factory in North Las Vegas.

The privately held company on Tuesday declined to say how much funding it has raised.

It is, however, backed by billionaire Jia Yueting, estimated last year to be China’s 17th richest man. And the company has repeatedly poached key talent from Tesla, recently hiring Tesla’s vice president of government relations, James Chen, as its general counsel.

If Vallejo and Faraday reach an agreement to develop the Mare Island site, the Bay Area factory would cost “hundreds of millions” of dollars, according to the company. It would also include a “customer experience” center, where people interested in the cars could test drive them and see them being made. City officials anticipate the facility would provide hundreds of jobs.

First, the Nevada factory

The Mare Island plant would come online after the Nevada factory, according to the company. Faraday also hinted that it is examining other potential plant locations.

“Faraday Future strongly believes in the growing demand for electric vehicles and (is) confident in the success of our future products,” the company said in an email to The Chronicle. “As a result, we expect to reach maximum capacity at our Nevada factory within two to three years of opening. We are currently undergoing a site selection process for a second facility to align with our future manufacturing development plan.”

If built, the Vallejo facility would be the first California car factory constructed from the ground up in decades, according to the city. It would also place Faraday less than 60 miles from the state’s only operating auto plant — the Tesla factory in Fremont.

Unproven startup

Ouse said Vallejo officials know they’re dealing with an unproven startup. But the possibility of bringing hundreds of jobs to the community, she said, makes the discussion worthwhile. If the council approves, Faraday will have six months to negotiate an agreement to obtain the site.

It won’t, strictly speaking, be a sale. According to the city, the costs of demolishing existing buildings on the site and reworking or replacing infrastructure give the proposed factory location a “negative land value,” confirmed by a real estate appraisal. So the city envisions giving the site to Faraday at no cost, with the company picking up any remediation expenses, estimated to be at least $50 million.

The company and the city have been discussing the project for nearly a year, brought together by the Governor’s Office of Business and Economic Development, also known as GO-Biz. The office had been helping Faraday scout potential factory locations well before the company settled on building its first factory in Nevada. GO-Biz also recently gave Faraday a $12.7 million tax credit to create more jobs in the state.

Mare Island already hosts businesses employing about 2,300 people, doing everything from building energy-efficient, prefab homes to brewing beer. But the Faraday factory, if built, has the potential to become the city’s largest employer, officials said Tuesday. Tesla’s Fremont factory, for comparison, currently employees about 6,000 people.

“When we first started marketing this property, our first objective was good-paying jobs with green technology and an employer willing and able to make the necessary investment,” Mayor Osby Davis said, in a press release. “Faraday Future and its plans to make Vallejo its second manufacturing site and bring green technology to Mare Island checks all the boxes.”

David R. Baker is a San Francisco Chronicle staff writer. Email: dbaker@sfchronicle.com