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Another EV rising star

Another EV rising star
August 20 2020

Yet another electric-vehicle company is becoming publicly traded via an acquisition by a special purpose acquisition company, or SPAC. This time Hennessy Capital Acquisition buying Canoo.

Canoo is unique insofar as it plans to offer its EV on a subscription-only basis when it goes into production in 2021, and it wants to make other vehicle “cabins” that will use the same underlying “skateboard” platform (the full package of the battery pack, electric motors, and other electronics that make the vehicle move).

Subscribers can put their stuff in the vehicle and keep if for “a month or for 10 years,” explains Canoo CEO Ulrich Kranz to Barron’s. The subscription fee includes maintenance, insurance, and access to charging stations.

Canoo has developed an EV powertrain it thinks will make it a low-cost player in the industry. The company’s flagship vehicle will arrive in 2022. Canoo is targeting young professionals interested in a subscription model. Eventually, it plans to develop other vehicles such as commercial vans, similar to Workhorse (ticker: WKHS). Canoo’s commercial vehicle is slated for 2023. Canoo will outsource assembly, rather than manufacture its own vehicles.

The transaction with Hennessy is valued at $1.84B and is slated to close in the fourth quarter of 2020. It will bring about $600M into Canoo to help fund its development plans.

 

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EV Companies That Have Gone SPAC:

Originally called Evelozcity, Canoo was founded in late 2017 by Stefan Krause and Ulrich Kranz after they split off from struggling EV startup Faraday Future. They had been hired earlier that year as part of an attempt to save the startup from financial collapse, but ultimately, they left after clashing with Faraday Future founder Jia Yueting.

Nikola Corporation is an American company that has announced a number of concept zero-emissions vehicles since 2016 and has indicated plans to produce some of them in the future. The company is based in Phoenix, Arizona, where its research and development facility is located.

Fisker Automotive was an American company known for producing the Fisker Karma, which was one of the world's first production luxury plug-in hybrid electric vehicles. It debuted at the 2008 North American International Auto Show, and the first deliveries were in 2011.

Lordstown Motors Corporation is an American automobile manufacturer of electric vehicles. Lordstown Motors is located in Lordstown, Ohio, United States, in the former Lordstown Assembly which previously belonged to General Motors.

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