Electric car startup Canoo announced Tuesday plans to go public in a deal that values the company at $2.4 billion. It will be the fourth carmaker to do so this year as the industry rides on Tesla's soaring Wall Street valuations.
The merger with Hennessy Capital Acquisition, a special purpose acquisition company, gives Canoo access to $600 million that will help it produce and launch its first commercial vehicle by 2022.
<p>It's also the second electric car company, <a data-linked-post="2646402528" href="https://dot.la/fisker-ipo-2646402528.html" target="_blank">behind Fisker in Los Angeles</a>, to skip the traditional path to an IPO as the industry takes hold in Southern California. Earlier this year, the Chinese-owned luxury electric carmaker Karma, based in Irvine, <a data-linked-post="2646804376" href="https://dot.la/karma-automotive-ipo-2646804376.html" target="_blank">said it was talks with investment bankers to go public</a>. It is expected to close by the end in the fourth quarter of 2020.</p><p>Canoo Inc. will be listed on the Nasdaq under the ticker symbol "CNOO."</p><p>Canoo was founded in 2017 as Evelozcity by two former BMW executives. It opened up a waitlist in January for their eponymous prototype vehicle — a futuristic looking minivan — that it will offer to drivers as a subscription service. Canoo said its 300 workers designed, engineered and manufactured the beta vehicle in 19 months, completing more than 50 physical crash tests.</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<a href="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY3NDI3My9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY0NzQ2MTE4M30.DOno2wICfp0j9sjZE51lNeO0t82z6BUVdz-5QHCr8-Q/img.jpg?width=980" target="_blank"><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY3NDI3My9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY0NzQ2MTE4M30.DOno2wICfp0j9sjZE51lNeO0t82z6BUVdz-5QHCr8-Q/img.jpg?width=980" id="66bb2" class="rm-shortcode" data-rm-shortcode-id="fc89aeae777bc5c9cba5ff5214ffe7ea" data-rm-shortcode-name="rebelmouse-image" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Canoo's "skateboard design" places components of the electric powertrain on a flatbed with wheels underneath the car much like a trailer..</small><small class="image-media media-photo-credit" placeholder="Add Photo Credit...">
Photo Courtesy of Canoo
</small>
</p><p>Electric vehicle maker Rivian, which plans to sell electric pickup trucks next year, <a href="https://dot.la/rivian-fisker-karma-2646385202/a-super-charged-electric-vehicle-market-rivian-fisker-and-karma-rake-in-funds" target="_self">announced it raised $2.5 billion in July</a>. It was followed by Los Angeles-based Fisker's news that it <a href="https://dot.la/fisker-ipo-2646402528/fisker-set-to-go-public-with-2-9b-valuation-ev-suv-to-roll-out-by-2022" target="_self">will go public in a deal with a SPAC</a> valued at $2.9 billion. Both are direct competitors, although neither is on the market yet.<br/></p><p>And Hyundai Motor Group, <a data-linked-post="2645109330" href="https://dot.la/canoo-hyundai-electric-vehicle-2645109330.html" target="_blank">tapped the Torrance-based startup</a> earlier this year to design the powertrain that will be used for their electric vehicles. <br/></p><p>"Today marks an important milestone of Canoo's effort to reinvent the development, production and go-to-market model of the electric vehicle industry," said Canoo co-founder and CEO, Ulrich Kranz. "Our technology allows for rapid and cost-effective vehicle development through the world's flattest skateboard architecture, and we believe our subscription model will transform the consumer ownership experience.</p><p><span></span>Canoo's "skateboard design" places components of the electric powertrain on a flatbed with wheels underneath the car much like a trailer. That design can be switched out on different vehicle shells.</p><p>Elon Musk's publicly traded Tesla, now valued at at $351.4 billion, became the most valuable car company in the world this July. And while it only produces a fraction of the world's new cars, its skyrocketing share value has given momentum to the $95 billion electric vehicle market, with sales expected to quadruple by 2025.</p>
From Your Site Articles
- Karma Automotive Details Plans to Go Public - dot.LA ›
- Canoo Gets Tapped by Hyundai to Design Electric Powertrain - dot.LA ›
Related Articles Around the Web
Read more
Show less
Luxury electric car company Karma is in talks with investment banks to help it go public, company officials told dot.LA.
Karma is hoping to ride the Tesla wave of success and capitalize on the soaring valuations of its competitors.
"We want to take advantage of the fact that the market is red hot right now, so we want to be fast," said Mikael Elley, chief of staff at Karma Automotive.
<p>The Chinese-owned automaker hopes to go public either through a merger with a special purpose acquisition company or through an initial public offering in the U.S. or Hong Kong over the next six months, he said. </p><p>Elley didn't say how much the company, headquartered in an office park in Irvine, was hoping to raise but it's in the midst of carrying out ambitious plans to increase its production of cars by at least ten times its current output. It's also developing delivery vans and selling an electric vehicle startup platform to manufacturers. </p><p class="pull-quote">"We know a lot of Tesla owners, they feel like 'it's my Silicon Valley Camry', right? I mean everybody else has got one, so they're looking for something else. There's definitely a void in the market."</p><p>Billing itself a "high-tech mobility incubator," the company says it can help larger car companies that are investing billions of dollars into capital for new green cars manufacture, design and engineer them.<br/></p><p>"We are talking with investment bankers right now to take us down that path," he said. "I think that everybody realizes that there is still a void, there is still an opportunity to get into the EV space." </p>
<p>Elon Musk's publicly traded Tesla became the most valuable car company in the world this July. And while it only produces a fraction of the world's new cars, its skyrocketing share value has given momentum to the $95 billion electric vehicle market, with sales expected to quadruple by 2025. </p><p>Electric vehicle maker Rivian, which plans to sell electric pickup trucks next year, <a href="https://dot.la/rivian-fisker-karma-2646385202/a-super-charged-electric-vehicle-market-rivian-fisker-and-karma-rake-in-funds" target="_self">announced it raised $2.5 billion earlier this month</a>. It was followed by Los Angeles-based Fisker's news that it <a href="https://dot.la/fisker-ipo-2646402528/fisker-set-to-go-public-with-2-9b-valuation-ev-suv-to-roll-out-by-2022" target="_self">will go public in a deal with a SPAC</a> valued at $2.9 billion. Both are direct competitors, although neither is on the market yet.</p><p>"If you are an EV company, now is the time to go to market," said Asad Hussain, mobility tech analyst at Pitchbook. "Right now sentiment on EVs is so positive that less-established EV companies — even companies without a product — are getting high valuations, but that could change."</p><p>With production facilities in Moreno Valley, Karma is the only U.S.-based electric vehicle startup that is producing and selling vehicles other than Tesla. Last year it rolled out about 550 of its Revero GT, an ultra luxury electric vehicle that starts around $135,000. </p><p>But Elley said that Karma wants to ramp up production of the Revero GTE, set for release mid-year 2021, and bring down cost to $100,000 so the car appeals to a broader market. </p><p>"We think that we can get the price down to take advantage of more volume and still be the luxury premium space," he said. "We know a lot of Tesla owners, they feel like 'it's my Silicon Valley Camry', right? I mean everybody else has got one, so they're looking for something else. There's definitely a void in the market."</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzUxMzYyNS9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY2MzIxNzk5Nn0.o_XAWJ-XYdFcdjxtaefp-bEFOiiDLG_ckgBkCEV0MAs/image.jpg?width=980" id="7ba3d" class="rm-shortcode" data-rm-shortcode-id="db85db40b16abb9481668e9ac2feb5a3" data-rm-shortcode-name="rebelmouse-image" />
<small class="image-media media-caption" placeholder="Add Photo Caption...">Inside Karma Automotive's manufacturing plant in Irvine, California.</small><small class="image-media media-photo-credit" placeholder="Add Photo Credit...">Courtesy of Karma</small></p><p>He expects to produce 5,000 to 10,000 of the new cars. Meanwhile, the company is tweaking a branding campaign that can extend its luxury reputation and building lifestyle events around their vehicles such as wine tasting or trips. It's also eyeing a new generation of drivers. Karma has created a partnership with TikTok to raise the company's profile.<br/></p><p>"It's a step in the right direction. But it's still a competitive market," Hussain said. </p><p>The company is up against Porsche and Tesla in that price range, both with vehicles that have a reputation for better performance, he said. But Karma's "exceptional design" has made it attractive to enthusiasts.</p><p>Aston Martin designer Henrik Fisker created what is now Karma as Fisker Automotive in 2007 before it filed for bankruptcy in 2013. It was picked up the following year by auto parts manufacturer Wanxiang Group Corp. and renamed Karma. Four years ago, Henrik Fisker created an eponymously named competitor - which plans to sell its SUV Ocean in 2022. </p><p>Wanxiang has pumped about $2 billion into Karma, which has struggled to catch on. Earlier this month, president of Wanxiang's U.S. business Pin Ni <a href="https://dot.la/karma-car-2646367624.html" target="_self">said Karma secured $100 million from private investors</a> and has been looking to raise $300 million through shares as it seeks to expand its line of cars. Elley said as part of the financing effort, its parent company has agreed to set the company down the path to an IPO. It comes amid an <a href="https://dot.la/karma-automotive-layoffs-irvine-2645141964.html" target="_self">executive shake-up and layoffs at Karma</a> earlier this year.</p><p>Karma is trying to penetrate a market that traditional carmakers from Audi to Hyundai are trying to establish a foothold. Despite the pandemic, most carmakers haven't pulled back electric vehicle investment, a sign of just how much the market is expected to grow. </p><p>But Karma executives said the company is not relying on its sporty car for success, it has pivoted to become a car and technology company, an acknowledgement that car-making alone is too capital-intensive to sustain.</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzUxMzYxMi9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYwNzM4NDA3N30.9amENjRiiMawubd8vFGI_0kTy_0CBu-kofudalh3Irk/image.jpg?width=980" id="724ae" class="rm-shortcode" data-rm-shortcode-id="52ea7a08cf2321ced16ecc9f9881b21e" data-rm-shortcode-name="rebelmouse-image" />
<small class="image-media media-photo-credit" placeholder="Add Photo Credit...">Courtesy of Karma</small></p><p>Inside their corporate headquarters five so-called platforms, these modular engine and frames that make up the undergirding design of their electric car, are laid out just beyond the lobby. Using their show floor for these boxy, under-the-hood products is a nod to just how central that strategy has become.<br/></p><p>"It is a strategy we have to improve our efficiency and reduce the complexity," said Kevin Zhang, Karma chief technology officer. The modules can be used for Karma's own cars or be sold to larger manufacturers, he explained. </p><p>There's appetite for these. Earlier this year, Hyundai Motor Group - one of the world's largest carmakers - <a href="https://dot.la/canoo-hyundai-electric-vehicle-2645109330.html" target="_self">tapped Torrance-based startup Canoo</a> for their platform . The terms of the deal weren't disclosed, but a similar deal between the Korean automaker and UK-based Arrival catapulted the startup to unicorn status. </p><p>Karma is also working on developing a delivery van that it hopes to sell to major fleet operators like Amazon, FedEx and UPS. Already, competitor Rivian has secured a commitment from Amazon for 100,000 cars. </p><p>"Amazon has much higher demand than the hundred thousand they're gonna get from Rivian. They also have a much higher demand for different types of vehicles..Same thing for UPS. Same thing for FedEx," Elley said. "There is a tremendous opportunity there."</p><p><em>Do you have a story that needs to be told? My DMs are open on Twitter <a href="https://twitter.com/racheluranga" target="_blank">@racheluranga</a>. You can also <a href="mailto:rachel@dot.la">email me</a>.</em></p>
<img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzUxMzYxNC9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY2MDcyMTM4OX0.7ENcoguJ6m1i0FeRxfPTe5O9jTVhMYs6Uyjtf0DOlgM/image.jpg?width=980" id="53468" class="rm-shortcode" data-rm-shortcode-id="539e32889aa4bc2f1763257e8808f898" data-rm-shortcode-name="rebelmouse-image" />
Courtesy of Karma
From Your Site Articles
- A Super-Charged Electric Vehicle Market: Rivian, Fisker and Karma ... ›
- Los Angeles Could Soon See More Jobs in the Electric Vehicle ... ›
- Rivian, Fisker and Karma Rake in Funds - dot.LA ›
- Karma Automotive Lays Off 60, Mostly in Irvine - dot.LA ›
- Karma Automotive Comes Up with $100M in New Funding - dot.LA ›
- Canoo Is Set to Go Public - dot.LA ›
- Karma prices its electric car at $79,000 - dot.LA ›
Related Articles Around the Web
Read more
Show less
LA Tech Updates: EV-Makers Rivian, Fisker, Karma Get Super-charged; Facebook issue crashes TikTok
Jul 10 2020
Here are the latest updates on news affecting Los Angeles' startup and tech communities. Sign up for our newsletter and follow dot.LA on Twitter for more.
Today:
- Tesla shares soar, Fisker rumored to go public, Karma gets $100m
- Facebook issues crash TikTok, Pinterest, Spotify
<ul class="ee-ul"></ul><ul class="ee-ul"></ul>
A Super-Charged Electric Vehicle Market: Rivian, Fisker and Karma Rake in Funds
<img lazy-loadable="true" src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzQ0ODkzMi9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY2MTM3ODMzMX0.UWfOZ-BbJTQ676H7r_RF-vufC9bjolWV-svEz3PuewI/image.jpg?width=980" id="48e4a" class="rm-shortcode" data-rm-shortcode-id="e33f8e054400fe2f5c8240286835e06d" data-rm-shortcode-name="rebelmouse-image" />Rivian Automotive is the maker of electric pickup trucks.
<p>Tesla's success has super-charged investor interest in the electric vehicle market.</p><p>Exhibit A is the two Southern California-based electric car makers, <a href="https://electrek.co/2020/07/08/fisker-50-millio-funding-electric-suv/" target="_blank">Fisker</a> and <a href="https://dot.la/karma-car-2646367624.html" target="_self">Karma, which secured millions </a>in funding this week as they sought to ramp up production. Then came word Fisker, created by one-time Aston Martin designer Henrik Fisker, is now in talks to go public through a sale to a so-called blank-check acquisition company, <a href="https://www.reuters.com/article/us-spartan-energy-m-a-fisker/exclusive-electric-car-maker-fisker-eyes-deal-to-go-public-sources-idUSKBN24A2HZ" target="_blank">Reuters reported</a> on Thursday. </p><p>Today, Detroit-based Rivian Automotive, maker of electric pickup trucks that's backed in part by Ford Motor Co., announced that it secured $2.5 billion in funding from private investors.</p><p>The race to push out more electric vehicles comes as after Tesla supplanted Toyota as the most valuable car maker. Its shares have been soaring and it now has a market cap that stands at over $285 billion despite controversies and a much lower production volume.</p><p>Spartan Energy is bidding against other special purpose acquisition companies, or SPACs as they are called, to bring Fisker public through a reverse merger, according to the report. Spartan is backed by Apollo Global Management, a private equity firm. </p>With a freshly secured $50 million in private funds, Fisker plans to sell the Fisker Ocean luxury electric SUV at a starting price of $37,500 in 2022. Fisker's previous venture Fisker Automotive fell into bankruptcy in 2013 and was bought by a Chinese group that rebranded it Karma. That company, which has been struggling after several layoff rounds and restructuring, is Karma and earlier this week secured $100 million from investors. It hopes to use that to raise a total of $300 million and roll out a line of electric vehicles.Facebook issue crashes Spotify, TikTok, Pinterest
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY1OTE2Ny9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYyMzM5MzkwNX0.r90DRnE3UFTB07VJDqefqOFUPVUriT1wuJTlhmyh6Jc/img.jpg?width=980" id="c28ef" class="rm-shortcode" data-rm-shortcode-id="f523904d32b223a39171b3253b6ba1c1" data-rm-shortcode-name="rebelmouse-image" />farm5.staticflickr.com<p> If you were trying to use a handful of iOS apps including Spotify, TikTok and Pinterest Friday morning chances are you couldn't get in because of a Facebook log-in issue. </p><p> The hiccup came from Facebook's software development kit (SDK), which several apps rely on to operate. Developers use SDK for users who want to sign in with their Facebook account. </p><p> "Earlier today, a code change triggered crashes for some iOS apps using the Facebook SDK," Facebook's developer site announced. "We identified the issue quickly and resolved it. We apologize for any inconvenience." </p><p> The crash hit some of the biggest apps. </p><p> "Something's out of tune," Spotify's Status account said on Twitter in the early morning. "We're currently investigating, and we'll keep you posted here!" </p><p> It's the second time this year the Facebook interface has caused a crash. </p><blockquote class="twitter-tweet">Something's out of tune. We're currently investigating, and we'll keep you posted here!<br>— Spotify Status (@SpotifyStatus) <a href="https://twitter.com/SpotifyStatus/status/1281542997906202625?ref_src=twsrc%5Etfw">July 10, 2020</a></blockquote> <script async="" src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>From Your Site Articles
- Fisker to Go Public, Set to Produce Electric Cars by 2022 - dot.LA ›
- Karma Automotive Details Plans to Go Public - dot.LA ›
- Fisker Picks Up Manhattan Beach Headquarters - dot.LA ›
- Karma prices its electric car at $79,000 - dot.LA ›
Related Articles Around the Web
Read more
Show less