Electric vehicle (EV) startup Canoo looks to be staying above water for now thanks to an order from Walmart, the latest major deal between an American retail giant and an EV startup.
Walmart has signed an agreement with Canoo to purchase 4500 electric delivery vehicles, with the option to purchase up to 10,000.
The news saw Canoo’s share price more than double, welcome news for a company that posted a A$185.6 million loss in the first quarter of this year and which issued a ‘going concern’ warning.
Canoo plans to start production in the fourth quarter of 2022, with the first LDVs on the road in 2023.
Walmart will use the Canoo LDV for delivering online orders, part of its goal to achieve zero-emissions by 2040.
It uses fulfilment centres as well as 3800 of its stores as hubs from which to fulfil online orders, with deliveries managed by Walmart employees, independent contractors and, in some locations, autonomous vehicles and drones.
Canoo says the LDV has an interior designed for small package delivery “at competitive per stop economics”, with a modular design and 3.4m3 of cargo volume.
The LDV uses a proprietary, dedicated electric vehicle architecture, with steer-by-wire technology.
The delivery van uses an 80kWh battery, with a claimed 402km of range. Payload is a claimed 664kg.
Canoo hasn’t released powertrain specifications for the delivery van, but the people mover version will offer up to 261kW of power.
Said people mover version will also be available with either five or seven seats, with an unusual wraparound rear bench available. Canoo is calling it “a loft on wheels”.
Canoo selected Bentonville, Arkansas as its headquarters last year, which is where Walmart is headquartered, and has chosen a site in Pryor, Oklahoma for manufacturing.
“We’re encouraged that by being located in close proximity to the Canoo headquarters, we have the advantage to collaborate and innovate in real-time as well as the opportunity to aid in the creation of manufacturing and technology jobs here in our home state of Arkansas,” said Walmart’s senior vice president of innovation and automation, David Guggina.
“We are proud to have been selected by Walmart, one of the most sophisticated buyers in the world, to provide our high-tech, all-electric, American made Lifestyle Delivery Vehicle to add to their impressive logistics capabilities,” said Canoo chairman and CEO Tony Aquila.
“Our LDV has the turning radius of a small passenger vehicle on a parking friendly, compact footprint, yet the payload and cargo space of a commercial delivery vehicle.
“This is the winning algorithm to seriously compete in the last mile delivery race, globally.”
Canoo’s 8-K filing with the US Securities and Exchange Commission (SEC), as noted by Bloomberg, includes a clause that Walmart can receive common stock in Canoo equal to 20 per cent of the company.
Additionally, the purchase agreement prohibits Canoo from engaging with rival retail giant Amazon.
“Under the EV Fleet Purchase Agreement, the Company has agreed that, for the duration of the agreement, it will not enter into any agreement for any services involving the design, manufacture, consult, advice, lease, or sale of EVs to, or issue any equity, equity-linked or debt securities of any type, or enter into any agreement for the purpose of transferring control of the Company to, Amazon.com, Inc., its subsidiaries, or affiliates,” reads the fine print.
Canoo, which was founded in 2017 by Faraday Future alumni, has revealed three vehicles thus far: the pod-shaped LDV, the related Pickup Truck, and the blocky Multi-Purpose Delivery Vehicle.
The deal between Canoo and Walmart follows one announced between Rivian and Amazon, with the latter signing a deal to purchase 100,000 examples of the Rivian Electric Delivery Van (EDV).
Rivian share prices took a hit, however, when the e-commerce giant announced a deal earlier this year to purchase electric vans from Stellantis.
While not a retailer, General Motors has signed a high-profile deal with delivery giant FedEx to supply its BrightDrop electric vans.