From staff reports Months after struggling to secure a firm source of funding while watching its shares lose value on an almost daily basis, the people behind Canoo decided Jan. 17 to park the electric vehicle venture, flat tires and all, and filed for Chapter 7 bankruptcy.
The petition was filed in U.S. Bankruptcy Court for the District of Delaware. Canoo has total liabilities of more than $164 million and total assets valued at more than $126 million, court documents reflect.
Since it’s not a Chapter 11 reorganization, assets of the company with its manufacturing plant in Oklahoma City and a battery facility in Pryor will be sold to the highest bidder to pay off its debts.
Canoo said it would cease operations immediately and a court-appointed trustee will manage liquidation of the company.
At one point Canoo said it had an order book valued at more than $3 billion with customers that included Walmart. However, the company produced only a handful of vehicles for customers, including the State of Oklahoma and the United States Postal Service.
In a brief announcement, Canoo explained, “Despite being American- made, successfully delivering to such esteemed organizations as NASA, the Department of Defense, the United States Postal Service, the State of Oklahoma, and having agreements with Walmart and others, Canoo has unfortunately been unable to secure financial support from the U.S. Department of Energy’s Loan Program Office. Recently, the company’s executives were in discussions with foreign sources of capital. In light of the fact that these efforts were unsuccessful, the Board has made the difficult decision to file for insolvency.”
The announcement quoted Tony Aquila, one of Canoo’s largest investors and the firm’s chairman and CEO. “We thank the company’s employees for their dedication and hard work. We know that you believed in our company as we did. We are truly disappointed that things turned out as they did.”
Canoo said its operations ceased immediately.
Shortly before Christmas 2024, Canoo shut down its battery operation in Pryor, and furloughed 87 employees and ceased production at its manufacturing plant in Oklahoma City along Interstate 40.
About the same time, Canoo furloughed workers at its facility in Justin, Texas, too. That announcement came as the struggling EV maker experienced dramatic losses on Wall Street trading of its shares.
A month after furloughing workers and pausing operations at its Oklahoma City plant, the company revealed plans to auction off some of its engineering and manufacturing equipment in California. A company spokesperson said it was part of the company’s efforts to restructure.
“The company is selling equipment as part of its Realignment of its North American Operations,” said Susan Donahue, managing director for Skyya, a public relations firm representing the EV company.
State leaders championed the EV maker in 2021 when the company announced it would open a 400-acre campus at MidAmerica Industrial Park in Pryor. More than $100 million in state incentives were promised Canoo but approximately $1 million were actually provided the firm.
In 2022, Canoo bought the former Teres telehandler plant along Interstate 40 in Oklahoma City and CEO Aquila promised he would have 500 workers and produce 20,000 vehicles by the end of 2023. It didn’t happen.
Canoo was based in Texas but announced it planned to move its headquarters to northwest Arkansas. That, too, fell through.
Although the Oklahoma City Council voted two years ago to support Canoo with a $1 million incentive, Mayor David Holt said no money ever changed hands.
Holt told OK Energy Today it was a “potential” incentive and the city’s practice is to make no payments until certain benchmarks are met, but Canoo never met them.
“It was always pay-for-performance. So there’s absolutely no fallout for the City at all,” he wrote in a communication.
“As I always said, our involvement was always going to be a win-win for us, because the only way we would ever be financially supporting the endeavor was if it had already produced significant economic benefits for our community. That didn’t happen so we never paid an incentive. Of course we wish for all private sector endeavors in our city to succeed, and from that perspective, it’s too bad, but it has no effect on our incentive program or city finances in any way, shape or form.”
The mayor added, “And by the way, we have approved several incentives through the years that were never paid because benchmarks were never met. That’s just the way it goes sometimes.”