- EV automaker Canoo has closed its doors and filed for liquidation
- The company was founded in 2017 by two former BMW execs
- Despite orders from NASA and Walmart, Canoo’s vans never went into full production
It’s extremely difficult to build a car company from scratch, and the latest to prove that is Canoo — which is now up the creek without a paddle. The electric-vehicle (EV) company, which recently moved its headquarters from California to Texas, closed its doors for good in mid-January. This followed an announcement last December that it had idled its factories in Oklahoma and laid off 82 employees while it tried to secure new funding.
Canoo filed voluntarily under Chapter 7 of the U.S. Bankruptcy Code, which liquidates the company’s assets and distributes the proceeds to its creditors. It estimates its assets at US$126 million, but it owes more than US$164 million to its creditors.
The company was founded in November 2017, and even that was a bit of a soap-opera story. It traces back to Faraday Future, an EV company created in 2014 that’s still around but struggling to stay afloat. Two of its key executives – Stefan Krause, who’d been with BMW and Deutsche Bank; and Ulrich Kranz, who’d also been with BMW, as well as working with Apple on its failed self-driving EV project – left over issues with its financing. They founded their own company, Evelozcity, which was later renamed Canoo. Several other Faraday employees jumped ship to come over to it, prompting a lawsuit by Faraday over trade secrets and employee theft.
The original founders eventually left. Businessman and investor Tony Aquila invested significantly in Canoo in 2020 — “rescue capital,” actually, to keep it afloat. The auto company went public later that year, and Aquila became its CEO.
But let’s step back a bit before that. Canoo’s original vision was for EVs that would be available on a subscription basis, and would basically be operated by the user’s cell phone. The plan was to make a cargo van, a pickup truck, and a consumer-style van. There were also plans to sell its vehicles in Canada, starting in 2023.
A prototype delivery van was wheeled out in September 2019. The big news was that Canoo was designing and building its own EV platform, and in February 2020, Hyundai announced a partnership with Canoo to build Hyundai and Kia EVs on Canoo’s platform. It certainly sounded promising, but it never went anywhere.
Other deals that fell apart included a collaborative research centre with the University of Wisconsin; and an agreement for a Dutch company to build Canoo’s vehicles until it could build its own factory. It eventually built its own facility for vehicles and batteries in Oklahoma City.
Canoo did receive orders, including one from Oklahoma’s state government for 1,000 vehicles “at competitive prices” between US$35,000 and US$50,000. Walmart placed an order for 4,500 delivery vans, with an option to buy 10,000 more. That prompted Canoo to lease a production facility in Bentonville, Arkansas – the city where Walmart is headquartered – but it never got off the ground, and the 13 employees it hired to get everything going were fired in March of 2023.
Canoo’s original estimates were that it’d produce 3,000 to 6,000 vehicles in 2022; at least 14,000 in 2023; and make more than 40,000 vehicles in 2024. It doesn’t look like more than a dozen vehicles were ever actually produced, even though the U.S. Army evaluated Canoo vehicles for possible use as light tactical vehicles; and three transport vans were delivered to NASA’s Kennedy Space Center in Florida for moving crews around the facility. Canoo said it also delivered vehicles to the U.S. Postal Service.
In a press release, Canoo said that “despite being American-made” and “successfully delivering” to NASA and others, it had been unable to secure financing from the U.S. Department of Energy’s Loan Program Office, and that discussions with foreign investors were unsuccessful.
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