Electric Vehicle Start-up Canoo Shows off EV Pickup Style Truck
Yet another electric vehicle start-up is debuting yet another concept. We’ll be seeing a lot of never before heard companies piggy-backing on the silicon valley backed EV gold rush. Many of these start-up companies will fall stumble and get back up again only to fall into bankruptcy. Others will become part of larger organisations and merge out of existence. Canoo is one such Californian-based start-up. The 4-year-old company has never made any products yet still employs 300 people. How can a company exist if it doesn’t sell anything? Canoo was founded by a former BMW senior executive and a former Deutsche Bank CFO. This background is very appealing to big investors with big money to burn.
Canoo’s mission statement is to make affordable commercial electric vehicles such as minivans for ride-sharing and rental services. Hyundai Motors has taken a key interest in the company, it is a big company with big money to burn because it is currently investing $87 billion USD over five years as part of its electric car strategy. Clearly, Canoo is very appealing to Hyundai, so appealing the two companies formed a joint partnership in 2020. A couple of months later a massive investment fund, Hennessy Capital Acquisition Corp. IV. acquired Canoo and pumped $600 million USD into the company.
So why did this massive investment fund pump $600 million USD into Canoo, a company that has made nothing other than a Pickup style concept? It turns out Canoo is aiming to list on the NASDAQ and has a current valuation of $2.4 billion USD. The stock market is where big corporations participate in insider-trading and the buying and selling of shares. Canoo’s valuation is based on its future potential and the confidence traders have of the electric vehicle market. It really is an imagined valuation based on nothing more than speculation and confidence. Investors love confidence, it is the simplest form of trading there is.
Canoo debuted the Ford Ranger-sized pickup ahead of an Automobility LA event on Thursday and announced pre-orders will begin from June 2021. The vehicle will not be retail-ready until 2023. Current predictions for the electric pick-up truck market in North America are estimated to be 1-percent by 2022, rising to 5.7% by 2028. Canoo says its Pickup truck will have a driving range of between 200 – 300 miles and up to 600bhp. The company will initially contract manufacture orders. By 2025 Canoo claim they will launch a sports sedan.
We’ll see how this venture goes, as with any silicon valley start-up the company is ridiculously over-priced and we fully expect it will miss many of its milestones and deliverables. The LA presentation was merely a publicity drive for the investment funds and stock market raiders.