The EV startup apocalypse has claimed another brand. Canoo, a startup that built a handful of adorable electric vans, has filed for bankruptcy, and it’s looking like it won’t be coming back from the dead. With a small number of prototypes already in the hands of the USPS and NASA, among others, Canoo made it further than some startups, but it didn’t make it far enough.
The electric vehicle gold rush of the 2010s saw the dawn of many startups. For every Rivian, there were several Fiskers, with intriguing plans that ultimately weren’t sustainable. Canoo was one of the more interesting EV startups of this age, because its vision was to deliver a cab-forward electric van before Volkswagen announced the ID.Buzz.
With a capsule silhouette, a skateboard platform including low-profile composite transverse leaf springs, a friendly face, the promise of seating for up to seven, and a planned pickup truck variant, the Canoo Lifestyle Vehicle quickly became a proposed electric vehicle that people wanted to see succeed.
Canoo lasted long enough to secure contracts with the likes of NASA and Walmart, and produce more than 100 prototypes, but on Jan. 17, the music stopped. According to a press release, Canoo failed to secure the funding to keep going, halted operations, and announced that it was filing for Chapter 7 bankruptcy.
While several high-profile automotive companies like Wheel Pros doing business as Hoonigan have declared insolvency over the past year, most of these filed for Chapter 11 bankruptcy protection, which allows for continued limited operations and debt restructuring in order to stay in business. Sure, some changes will happen under Chapter 11, but generally, companies carry on.
However, Canoo has filed for Chapter 7 bankruptcy, which is an entirely different kettle of fish. Instead of permitting restructuring, Chapter 7 means a company’s gone, bust, ready to be picked over so that any proceeds from selling assets can be used to pay back creditors. Put simply, new Morimoto headlight components and Rotiform wheels will continue to be made, but you won’t see any new Canoo vans out and about.
So, what went wrong? Well, aside from the obvious fact that making cars is an extremely challenging business, several things failed to go Canoo’s way. One elephant in the room is capital allocation, with Automotive News reporting that Canoo spent more on its CEO’s private jet in 2023 than it took in as revenue.
The company spent $1.7 million reimbursing Aquila Family Ventures, an entity owned and operated by CEO Tony Aquila, for the usage of a private aircraft for purposes related to the business, Canoo said in its annual 10-Q filed with the SEC on Tuesday. The figure represents about twice the $886,000 the company brought in as revenue in 2023.
That’s not a great look for an EV startup that had seen numerous funding challenges, many of which simply came from a shift in environment. After all, Canoo was founded in the near-zero interest rate tech bull market of the late 2010s. Unfortunately, before production could start, markets shifted. From the brief economic dip of 2020 to the higher interest rates that followed, investors grew cold on funding EV startups, putting hopefuls in a pinch. Canoo did manage to raise funding by going public via SPAC in September 2020, but this alternative reverse-merger method of listing a company has proven to result in an iffy hit rate.
Following going public, Canoo ended up experiencing a revolving door of executives, a series of proposed facility moves, and other inefficiencies that may have set the company back. At the end of the day, it all ended up being a bit too much, which leads us to the present day, with the company filing for Chapter 7 bankruptcy and claiming less than $50,000 in assets. Considering the company was sued last year for allegedly missing a $10,600 payment, it’s quite plausible the value of assets on hand is low indeed.
You can’t help but feel bad for the workers who toiled in an attempt to make Canoo’s products successful, along with amateur retail investors who held Canoo in their Robinhood accounts, genuinely believing in the company. If the claim of having so few assets is true, anyone owned money by Canoo is likely largely out of luck.
At the end of the day, making cars is hard, and few of these electric vehicle startups had good chances for success. From the enormous amount of money required to develop a vehicle from scratch to the trials and tribulations of manufacturing hell and the low margins vehicles command compared to other goods, the carmaking business isn’t for everyone. What’ll happen to the Canoo prototypes roving America? I guess we’ll just have to wait and see.
(Photo credits: Canoo)
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This van looks cool, but I am disappointed by both this and the IDbuzz and their disingenuous designs. They are not cab forward vehicles like the old VW busses and the old Dodge vans. Instead, they are a regular vehicle with a regular hood and a windshield at the end of said hood, instead of closer to the driver. Look at where the driver seats are located in each van. I’m sure this is for crash safety reasons, but still, I can’t imagine that driving a vehicle like this doesn’t have significant compromises to visibility, it’s probably like looking out through a tunnel. I’ll wait to pass of definitive judgment until I sit in an IDbuzz.
The design of the vehicle looks like the were waiting for the autonomous car revolution that never happened.
I mean…
Wow, color me surprised, what will we find out next? That Francisco Franco is still dead?
The oddball part of me always loved this design, as it looks like somebody made an old VW van in Blade Runner or something. That said, screw that dipshit charging for so many private jet trips.
Another in the long line of ceo scumbags destroying company’s for lols and profit.
So….if a bunch of us get together, can we buy Canoo as a whole? I’m pretty sure we could figure it out.
What the hell, I’m in. I’ve got, um, $20.
So my plan is try to bid on one or more of the rolling and presumably functioning ones out of the auction, fly to CA, and try to roadkill it back home to Atlanta. I would love to own one of the very few examples of a still prototype/pre-production level vehicle that nobody on the planet except its engineers can service
and daily it.
(Otherwise, I’ll have to consider a cross country vantruck recovery trip…)
Tony Aquila (who was CEO of Solera at the time) bought out a company I was working for a while back. They immediately laid a bunch of people off and cost-cut to death. Fucked over a lot of good people. He’s a vulture and it’s fucking sad that America rewards total assholes like that guy. Fuck Tony Aquila.
He definitely sounds like a guy to steer clear of. On Wikipedia it says he sued Solera for breach of contract after leaving them, and Solera claimed in court filings that Aquila charged the company for private jet flights that were personal. Solera also claimed his behavior and comments resulted in turnover among executives. The lawsuit against Solera was thrown out. This guy stinks.
How a company handles small details can tell you about how they may handle the big details.
I was curious about where Canoo was located, so I looked at their website to see if an address was listed. It gave an address of “15520 TX-14 Justin, TX 76247.” I tried it in Google Maps and came up with nothing. After panning around, I saw there is a Texas Route 114. They messed up their own address on their website. It makes you wonder how diligent they were with running other parts of their business.
I had a few dollars tied up in their stock, but not much. I don’t regret it. Investing in startups is risky. They did have a few nice ideas and creative ways to think about solutions, and sometimes that’s enough.
I thought their design language was far too European for the American market, but it was quite effective at gaining attention. I was assuming it would change as it moved toward production, like so many show cars of the golden era of auto shows.
The story of Canoo is so incredible only Mormons would believe it.
Oh, sorry, that’s Mr. Canoehead, not Canoo..
Still…
I enjoy how it has a very 21st century name; it could just as easily be a male sexual dysfunction pill discounter, a fashionable mattress company, or a glorified payday loan provider.
And everyone mocks GM for decades of made up car names…
GOOD. GLAD IT IS DEAD.
“Wtf, settle down Rob”, you’re all thinking, but hear me out.
The primary reason that van went anywhere is due to it’s ‘adorable’ appearance, which is primarily because it’s aping the proportions of the VW Bus / Jeep FC… which are forward control vehicles, where the driver sits basically on top of the front wheel. Forward control vehicles have some upsides, mainly visibility, maximizing the interior space in a given wheelbase, and offroad prowess due to generally awesome approach angles.
HOWEVER, the reason nobody makes vehicles like that anymore is because they are so extremely unsafe, they will never pass crash safety standards.
So how is CANOO getting away with it? They aren’t. It’s a sham. A fake. Not authentic. Misleading. False Advertising.
See, when you glance at it in an article, you believe it’s a forward control vehicle, but it isn’t. You sit in a traditional spot in the vehicle, just like a typical pickup truck. They then just extended the roof and windshield all the way forward, resulting in absolutely awful visibility.
I made this example years ago showing how dumb and fake the whole design is.
Dieter Rams had a list of 10 traits of good design, and one of them is “good design is honest“, which CANOO was not at all. It was playing pretend. It was playing on the nostalgia of the aesthetics of deathtraps of yore, without any of their benefits.
Fellow based and FC-pilled Last Knight of the Defenders of the Cab-Over Van!
Ok, that’s pretty effed up. Thanks for the visual.
I’ve always thought it was hilarious that these Canoo things had the deck of an aircraft carrier as a dashboard.
I remember joking to myself “I could land a Cessna on that.”
The length and proportions of the “revised drawing” seem closer to the old square-body American vans with a partial front, like the 3rd gen Econoline or the pre-Express/Savanna named GM vans (the G series). It’s alright, but if we’re going that route the one-box/one-slope EU and Asian designs look better that way.
And in more practical considerations, “I’ll be dusting that continuously to not look like garbage,” or “tradesmen will be crashing these things when the accumulated 473 coffee cups suddenly shift during a hard right.” Visibility-wise, you’re still looking out over a hood, it’s just indoors now.
I mean, if you wanted to you could probably do similar, and flip down the windshield of a Wrangler and rig up some kind of bubble up front that would get you a 5 mpg improvement on the highway. But that wouldn’t make it a cabover.
Separate issue, I’ve wondered about having that kind of huge glass bubble shape out front, in frigid weather like Michigan, Minnesota &c. Since if these became postal trucks, they would be driven there. It would require massive hot air blowing, and with that curve I can imagine it blowing straight in the driver’s face and desiccating their eyes down to chick pea size.
Upvoted in particular because I don’t like chickpeas, making this even more perfectly gruesome.
I don’t know that I’d go with “fake” – it is definitely not forward control, given the front row seating position, but I do think there’s an honesty to it in regards to aerodynamics.
Modern subs have basically spherical noses to punch through the water most efficiency, and modern cars and trucks have evolved into semicircular noses in place of the flat planes they used to sport – canoo just extended the concept vertically to make it more rounded in all three dimensions.
As far as the windshield placement goes, GM sort of did the same thing with their 1st gen Pontiac Trans Sport minivan back in the day, so it’s not an entirely original idea. The biggest difference is the GM windshield was still largely flat side to side, whereas canoo went far more spherical.
I’d say VW could just buy all their stuff and redo it as the ID Buzz here in the USA, but it’s specs are just about as bad as the ID Buzz, not sure how fast it charges but only about 250 miles of range. Not that it matters on where they’re built anymore as the ev rebate’s going away.
VW would just botch the task. Best to put GM on the job. They’d drag it out a decade before killing it.
A Chinese car company already produces something like the Canoo
https://en.m.wikipedia.org/wiki/Zeekr_Mix
Don’t forget how much private jets cost.
Sad though, I really thought these were neat.
I have seen private flights used effectively once or twice – they can be really useful because you can easily get your design teams in the same room or your supply/sales teams up to speed quickly by getting everyone in the same room regularly if your are starting a new partnership, and finally there is no better way to get customers to see the factory than flying them in – this does require big potential customers and a factory/people you are proud of. That said, from my limited experiences with private flying most of the time it is wasted on top executives who could have done a conference call. And while costs are up, $1.7 million is a lot of flying – unless they were using heavy jets when a Pilatus PC-12 would work better.
IIRC the big 3 CEOs flew into Washington on the corp private jets to beg for bailout bux.
This is unfortunate.
I thought about putting down a refundable deposit on one of these, as I really liked the truck.
I’m guessing those are now non-refundable.
I’ll let you know :P, but I’m assuming that’s $100 I won’t see again.
This is one I’m truly sad to see fail. It would have been so cool to have one of these towing an Airstream….
…but when CEOs treat startups like personal ATMs – you know the writing is on the wall. If only there were some laws regarding that.
Somebody’s up the creek without a paddle 🙁