Canoo adjusts US electric vehicle production plans as overseas deal falls

LA Auto Show in Los Angeles
Canoo Lifestyle vehicles are on display during the 2021 LA Auto Show in Los Angeles, California, USA, November 17, 2021. REUTERS / Mike Blake / photo file

December 15, 2021

By Ben Klayman

DETROIT (Reuters) – Electric vehicle startup Canoo Inc said on Wednesday it is accelerating its plans to produce in the United States while ending a contract with VDL Nedcar in the Netherlands as a contract manufacturer. their counterparts in Europe.

Shares of Canoo were up 3% in after-hours trading.

The Arkansas-based company said the move from using VDL Nedcar overseas to relying on plants it is building in northwest Arkansas and Pryor, Oklahoma, was done to reduce vulnerabilities in the chain. supply and shipping costs abroad, and speed up marketing their vehicles. .

“The initiatives announced today are another step forward in implementing our risk mitigation and certainty enhancing strategy,” CEO Tony Aquila said in a statement. . “We have concluded that building in the US is more in line with our mission.”

Canoo says starting production in Oklahoma is still underway by the end of 2023, but it now also expects to begin electric vehicle production in Arkansas next year, instead of using the VDL Nedcar plant.

It added that while the deal with VDL Nedcar has ended, it is still seeking cooperation opportunities in Europe with the Dutch parent company, VDL Groep BV.

Canoo said VDL Nedcar will return Canoo’s advance payment of $30.4 million, but VDL Groep will purchase $8.4 million worth of Canoo stock.

Canoo said it now expects to build between 3,000 and 6,000 EVs next year in Arkansas, up from its previous goal of 1,000 overseas. It also plans to produce 14,000 to 17,000 EVs by 2023, compared with a previous target of 15,000.

The company also set a production target of 40,000 to 50,000 vehicles by 2024 and 70,000 to 80,000 by 2025. Canoo previously said the Oklahoma plant would build to its full capacity of 150,000 units per year.

Canoo said in November it will add a plant in Arkansas to build small package delivery vehicles, but a spokesman said the facility will be able to flex between that type of vehicle and that of the truck. the company’s seven-seat row, which the company calls a “lifestyle car.”

In December 2020, Canoo listed shares through a reverse merger with a special purpose acquisition company (SPAC). In April, it changed executives, with Aquila, a former software executive and one of Canoo’s largest shareholders, taking over.

Canoo has developed a “skateboard” or low platform that houses a battery and an electric motor with chassis components such as the handlebars, brakes and wheels, on which various body types can be built. The company also plans to build a pickup truck.

(Reporting by Ben Klayman, Editing by Marguerita Choy) Canoo adjusts US electric vehicle production plans as overseas deal falls

Caroline Bleakley

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