The failing electric car company Canoo believes it is going to run out of cash. The firm says that it barely has enough cash to endure another quarter and is doubtful if it would be able to stay viable beyond that.
In its first-quarter financial report, the firm writes, “As of the date of this notice, we are announcing that there is serious doubt regarding the Company’s ability to continue as a going concern.”
When former BMW executive Stefan Krause left struggling EV company Faraday Future in late 2017, he created Canoo.
Faraday Future sued Krause and some of the other executives who co-founded Canoo — then known as Evelozcity — for poaching personnel and allegedly stealing trade secrets, but the case was resolved in late 2018.
The MPDV, a multi-purpose delivery van, and the Canoo Pickup Truck are among the EVs in development at the carmaker.
The toyish truck demonstrated how far Canoo is ready to go with the design of the microbus-style car it initially unveiled in 2019, which it had planned to sell only through subscription.
As of March 31st, the firm had $104.9 million in cash and cash equivalents. Canoo lost $125.4 million in the third quarter of 2020, compared to $15.2 million in the first quarter of 2021.
Canoo chairman and CEO Tony Aquila said in a statement that the firm has $600 million in “accessible financing” to fund the manufacture of its electric vehicle portfolio.
Canoo has filed for a $300 million universal shelf, as well as a committed PIPE from an existing shareholder and an equity purchase agreement with finance partner Yorkville Advisors.
In recent months, the corporation has begun laying off executives.
Canoo disclosed last year that the Securities and Exchange Commission was looking into its merger with a special acquisition firm. Canoo also launched a lawsuit this week to reclaim gains made by a major investor with links to China.
To read our blog on “Renault to consider selling a stake in Nissan to fund an electric vehicle shift,” click here.