The company will not do business with rival Amazon. Walmart agreed to order up to 10,000 vehicles from Canoo for its delivery fleet and to join the start-up. Canoo will not sell any vehicles to Amazon for the duration of the delivery deal, nor will it be taken over by the world’s largest retailer, according to documents released on Wednesday.
Canoo is one of a series of electric car-Start-ups that wanted to benefit from the changes in the industry and then got into difficult waters. The company was founded in 2017 by former BMW manager Ulrich Kranz, among others. One of the original ideas was that the cars should not be sold but used on a subscription basis. The plan was later abandoned in favor of a traditional model. Kranz has since moved to Apple. When presenting the latest quarterly figures in May, Canoo warned that the company was facing cash shortages.
The development made the deal with Walmart all the more valuable to Canoo. The supermarket group, in whose hometown Bentonville Canoo moved its headquarters last year, wants to buy 4,500 electric vans from the company as a first step, with an option for another 5,500. Canoo wants to start producing the vehicles at the end of the year. Over the next ten years, Walmart has an option to exercise more than 60 million Canoo shares, currently representing more than one-fifth of the company.
Walmart and Amazon are on a collision course. The online retailer is cutting into the supermarket business, and Walmart is increasingly trying to expand its online activities. Amazon is an investor in the electric car supplier Rivian (Rivian Automotive) and wants to buy 100,000 electric delivery vehicles from the company.
The Canoo share finally reacted on the NASDAQ with discounts of 1.65 percent to 3.57 US dollars.
/so/DP/pcs
BENTONVILLE (dpa-AFX)
Leverage must be between 2 and 20
No data
More news about Amazon
Image sources: rafapress / Shutterstock.com, Postmodern Studio / Shutterstock.com