The US electric vehicle manufacturer Canoo has filed for Chapter 7 bankruptcy and will cease operations immediately. This marks the end of the road for the company that emerged from the Californian EV startup Evelozcity in 2019.
Canoo cited the inability to secure a loan from the US Department of Energy as the primary reason for its bankruptcy filing. Subsequent attempts to attract foreign investors also proved unsuccessful, leading the company to make the “difficult decision” to file for insolvency.
Tony Aquila, Canoo’s Chairman and CEO, expressed his disappointment and thanked employees for their hard work and dedication. He also acknowledged the support of key partners like NASA, the Department of Defense, the USPS, the State of Oklahoma, and Walmart.
As a Chapter 7 bankruptcy, Canoo will undergo complete liquidation of its assets. This differs from Chapter 11, which allows for company reorganization.
Canoo’s flagship models, the Lifestyle Vehicle (LV) and Lifestyle Delivery Vehicle (LDV), were manufactured at a plant acquired in Oklahoma in late 2022. Despite acquiring production equipment from the insolvent British EV developer Arrival earlier this year, production will now cease.
Canoo was founded by German automotive executives but underwent a significant reorientation under Tony Aquila’s leadership, including a shift from a subscription model to direct sales and a rejection of the founders’ plans for a skateboard platform.
While aiming for global expansion, plans for European production fell through.
Canoo has faced persistent financial difficulties, with warnings about its ability to continue as a going concern issued as early as May 2022.
The SEC imposed a $1.5 million fine on Canoo for misleading investors with unrealistic revenue forecasts prior to its 2020 IPO.
Canoo had secured significant orders from the USPS, Kingbee, Zeeba, and Walmart, but the status of these orders remains uncertain following the bankruptcy filing. The company’s history is marked by challenges, including liquidity issues and a controversial IPO.
