Once-Promising Canoo Is The Latest EV Startup To Fall Apart

Upstart electric automaker Canoo promised to build an adorable electric van. The California-based startup got some big-hitter backing in its early years, including a deal to develop platforms with Hyundai and talks with Apple for its planned car.

But those plans fizzled, much like the Fisker Ocean. As did its plans to open a factory in Pryor, Okla., to start building vehicles there, and a later plan to move into an existing building in Oklahoma City. The company has finally succumbed to that big problem that has taken out so many startups: It has run out of cash, and no new investors are coming along. As a result, Canoo has declared Chapter 7 bankruptcy. Unlike Fisker and Lordstown, where a Chapter 11 filing left open a possible restructuring, Chapter 7 is the one where the company is liquidated.

Canoo Had Big Partners But Couldn’t Get To Production

Canoo’s team broke the news in a press release late on January 17th. “Canoo Inc., a high-tech advanced mobility and energy company, today announced that it has filed a voluntary petition for relief under Chapter 7 of the U.S. Bankruptcy Code.”

The release was a lament of the times when the company almost made it but couldn’t quite get around the bend. It had agreements with NASA, the Department of Defense, the US Postal Service, WalMart, and more. However, it could not get support from the Department of Energy’s Loan Program Office in order to keep moving forward, and the company’s executive team was unsuccessful at bringing in foreign capital.

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“We would like to 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,” said Chair, CEO, and investor Tony Aquila.

A Promising EV With A Tumultuous Story

Canoo was founded in 2017 by two former Faraday Future executives, changing its name from Evelozcity in 2019. That same year, it unveiled its so-called lifestyle vehicle prototype model. It made no revenue in 2022 and almost none in 2023. Development costs kept piling up, with more than $1 billion in loans.

Its struggles weren’t just financial. In 2022, the company accused several former execs of stealing trade secrets and starting a new car company. That new automaker is Harbinger Motors, which builds electric commercial trucks.

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The filing comes just weeks after Canoo idled its factory and laid off workers. In 2022, the company claimed it had more than 60,000 orders. 18,000 of those, including 4,500 from Walmart, it said were binding. Canoo had been taking $100 reservations from consumers since 2020. In November 2024, it said it had started refunding those deposits, making the decision to sell to fleets and not individuals. It’s not clear how many of those were refunded (or how many had been taken) before the bankruptcy.