Canoo faces financial difficulties
The accusations by the staff were made over alleged mismanagement and misleading production claims. As a result of the ongoing issues, the company’s stock has plummeted over 50% to a new low of $0.37.
According to a report by carscoops, the company now only holds $4.51 million in cash and equivalents and is still struggling to deliver vehicles in a profitable manner. Canoo reported a net loss of $117.6 million during the first half of 2024 and expects revenues of between $50 million and $100 million for the full year. Last year, Canoo only managed to deliver 22 vehicles and faced legal issues over non-payment of suppliers.
Furthermore, the 30 employees represent a significant amount of the workforce at 23%. Under the furlough, the employees will not receive their paychecks for the 12 weeks but will maintain their health insurance until the end of November.
The news is somewhat surprising, as Canoo’s last major statement in September had been that it was planning to expand to European markets, even selecting a base of operations and being lauded as a “significant milestone in the company’s global expansion strategy.” However, some trouble was brewing on the horizon with the revelation that the CEO had spent more on his private jet than the company had earned in April. Toward the end of September, the company had also announced plans to officially move its headquarters from California to Texas, emulating Tesla’s move in 2021.
Canoo has made a statement to the local publication The Oklahoman: “Canoo has made the difficult decision to temporarily reduce our workforce in Oklahoma City by furloughing 23% of our factory workers for a period of twelve weeks as part of a broader realignment of our North American operations. This reduction is a continuation of our efforts to consolidate our U.S. workforce which includes redistributing some of our tenured and skilled employees to our Oklahoma City and Texas facilities as part of our comprehensive plan and supply chain harmonization to prepare the company for the next phase of growth.”
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