Walmart orders 4,500 electric transporters from Canoo

The Californian electric car start-up Canoo has announced a large order from Walmart. The US retail giant has signed a binding agreement with Canoo to buy 4,500 all-electric delivery vehicles, starting with the Lifestyle Delivery Vehicle (LDV), a cargo variant of the Canoo Lifestyle Vehicle.

+ + Kindly see our update below ++

The contract includes the option to buy up to 10,000 units, according to Canoo. However, the vehicle is not yet being built: Canoo expects production of the LDV delivery vehicles to begin in the fourth quarter of 2022.

From 2023, the US retail giant will then use the electric transporters to deliver online orders “in a sustainable way”, Canoo says. Walmart’s goal is to be emission-free by 2040. With this in mind, Walmart is working on the conversion to electric vehicles in the various areas of its transport chain: The retailer plans to use the first battery-electric heavy-duty trucks of the types eCascadia from Freightliner and Tre BEV from Nikola for trips around its distribution centre in Fontana, California, on a trial basis starting this summer. In terms of electric delivery trucks for last-mile delivery, Walmart has placed large orders with GM’s BrightDrop brand, as well as ordering 1,100 Ford E-Transits.

The electric delivery fleet is to be supplemented by the Canoo LDV in the future. Canoo is still holding back with exact technical data on the vehicle. It generally states that the LDV, like all of the company’s vehicles, is based on a proprietary multi-purpose platform (MPP) architecture that integrates motors, battery modules and other important drive components. Last year, the Lifestyle Vehicle was said to have a battery capacity of 80 kWh, allowing a range of 400 kilometres.

There is a little more information about the body of the delivery van: the LDV has a cabin optimised for last-mile delivery and a customised cargo area. The latter is said to have a load volume of up to 120 cubic feet, which is equivalent to 3.4 cubic metres. This would make the Canoo van significantly smaller than the BrightDrop vans on order: the EV410 has an 11.3 cubic metre load space, the EV600 up to 17 cubic metres.

Still, using the Canoo LDV may make sense for Walmart, as it is optimised for other tasks. Canoo states that the vehicle is designed for “high-frequency stop-and-go deliveries and fast vehicle-to-door deliveries” – “including grocery and food deliveries”. The LDV is said to show its advantages especially for small parcels. Canoo also emphasises the modularity of the cargo space, which can later be adapted to changing requirements. If the purpose changes, there is no need to purchase a new vehicle – which reduces the investment per vehicle.

For Canoo, the launch customer for the LDV could be a kind of lifeline in view of the unit numbers mentioned: The company is heavily in debt and, as reported, had questioned its own future this May. Most recently, there were rumours that Canoo could be a takeover candidate. The company was founded as Evelocity to offer subscription electric cars and to market its skateboarding platform under licence to other carmakers. Following the arrival of Tony Aquila as investor and chairman, the company has refocused its strategy and now aims to sell its vehicles – without platform licences.

“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,” says Canoo 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.”

“Today, the closest Walmart to customers is right in their pockets – it’s the Walmart app. By continuing to expand our last mile delivery fleet in a sustainable way, we’re able to provide customers and Walmart+ members with even more access to same-day deliveries while keeping costs low,” said David Guggina, senior vice president of innovation and automation, Walmart US. Walmart delivers online orders not only from dedicated logistics centres, but also from its 3,800 shops.

Update 14 July 2022:

The Californian electric car start-up Canoo has had to swallow a few gnarly fine print clauses in its deal to sell up to 10,000 electric delivery vehicles to Walmart, according to a notification to the US Securities and Exchange Commission (SEC). Over the next ten years, Walmart can exercise the option on about 61 million Canoo shares at a unit price of US$2.15, giving it about a quarter stake in the company. Canoo also had to agree not to sell any vehicles to Amazon for the duration of the delivery deal, nor is it to allow itself to be taken over by the online giant. In fact, Canoo must refrain from any business whatsoever with Amazon or any of its subsidiaries.

A report by Business Insider concludes: “Canoo is much more dependent on Walmart than Walmart is on Canoo.” Moreover, an analyst is quoted who sees in the clauses a distrust on the part of Walmart that Canoo can also deliver the vehicles.

With reporting by Sebastian Schaal, Germany.

canoo.com, update: sec.report, businessinsider.com, electrek.co