Canoo Inc. (GOEV), the electric vehicle (EV) startup, has filed for Chapter 7 bankruptcy, ceasing all operations effective immediately. With the Chapter 7 filing, Canoo will liquidate its assets and a court-appointed trustee will oversee the process, ensuring that proceeds are distributed to creditors.
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Founded in 2017, Canoo aimed to change urban transportation with its bus-like electric vans. However, despite early excitement, the company faced major financial troubles, including rapid cash depletion and difficulties in securing additional funding.
Canoo’s Efforts Fail to Sustain Operations
Canoo’s attempts to obtain financial support from the U.S. Department of Energy’s Loan Programs Office were unsuccessful. Additionally, efforts to attract foreign investors did not materialize, leading the company to make the difficult decision to file for bankruptcy.
Also, the startup had secured notable collaborations, including agreements to produce shuttles for NASA’s Artemis program and a deal to manufacture 4,500 electric delivery vans for Walmart (WMT). Despite these partnerships, Canoo struggled to achieve sustainable operations.
Tony Aquila, Canoo’s chairman and CEO, thanked the company’s employees for their dedication and hard work, adding, “We know you believed in our company just as we did. We are truly disappointed that things turned out as they did.”
Are EV Stocks Losing Charge?
No, but smaller EV startups like Canoo are struggling as competition grows and funding dries up. Meanwhile, established players like Tesla (TSLA), Rivian (RIVN), and Nio (NIO) lead the market with higher production and strong demand. Also, legacy automakers like Ford (F) and General Motors (GM) are gaining ground, using their scale and resources. As such, traders might bet on this sector instead and could make informed decisions with the help of TipRanks comparison tool shown below!
