The EV startup isn't dead yet.
American EV startup Canoo began life in 2011 with a lot of promise. It managed to strike a deal with the Hyundai Motor Group to jointly develop its unique skateboard EV platform, an odd choice for the South Korean automaker considering it already has its own dedicated EV setup. And then Hyundai backed out of the deal for unspecified reasons, leaving Canoo in a potential life or death position. Fast-forward to today, and Canoo is still alive and about to get a second chance.
The Associated Press reports that Oklahoma Governor Kevin Stitt will award Canoo a state record-setting $15 million in assistance to help its planned investment in the state. All told, Canoo plans to spend over $560 million in new facilities in Oklahoma.
Stitt's administration wants to help Canoo create around 1,500 jobs at a planned new factory in the city of Pryor, and another 700 jobs at two separate facilities in Oklahoma City and Tulsa. On top of that, Canoo has confirmed the state has committed to purchasing 1,000 vehicles likely for government use. Specific details of the planned investment are expected to be announced soon.
Oklahoma has been on the hunt for a company like Canoo after it lost its bid to lure Tesla a few years back. If you recall, Oklahoma and Texas were the two finalists for the new Gigafactory that'll eventually build the Cybertruck and Model Y.
Texas ultimately won and that factory is now in the advanced construction stages. But Tesla CEO Elon Musk was impressed by Oklahoma's efforts and resources, saying he's still considering the state as a potential future location for a distribution center. Oklahoma clearly wasn't willing to wait and began pursuing other options. Canoo fit the bill.
The EV startup went public in 2020 via a SPAC merger. There's an ongoing Securities and Exchange Commission (SEC) investigation regarding possible improprieties regarding that merger. Canoo has also been losing top talent in recent months and that's very troubling for investors. That's why the Oklahoma deal is more than just a huge opportunity; it's a lifeline.