Bankrupt electric vehicle brand Arrival has sold some of its assets, including advanced manufacturing equipment, to Canoo, another struggling startup trying to build and sell electric vehicles.
The acquisition, which has been described as a cost-saving measure that will reduce capital expenditure by 20%, comes as Canoo struggles to move beyond prototyping towards commercial production. Cano said the purchased assets, packed into more than 20 container ships, will be sent to the company's facility in Oklahoma. The company previously acquired all new and “near-new” assets owned by Arrival's US business unit. It is not clear whether Canoo has also acquired any of Arrival's intellectual property rights.
Canoo did not respond to a request for comment.
Arrival announced in January that it plans to sell assets and intellectual property from its U.K. division after it filed for bankruptcy protection in the U.K. Arrival, once valued at more than $13 billion and backed by Hyundai and UPS, claimed it would revolutionize… Producing electric cars by manufacturing them in compact “mini-factories” that can be located in city centers.
Those plans, which included an electric bus, minivans and even a car specifically designed for Uber, fell apart because they drained money and a number of executives. Arrival has restructured at least three times – each time, laying off workers – and shifted its focus to the US and away from the UK market to conserve capital. Arrival has never produced any commercial vehicles on a large scale and now has a market value of about $7.7 million. After years of volatility and a stock price that lost almost all of its value, the company filed for bankruptcy.
Meanwhile, Kano faced her own struggles. After going public through a merger with a special purpose acquisition company, the company has struggled to produce its electric car, an eye-catching design based on a “skateboard” architecture that houses the batteries and electric propulsion system in a structure beneath the car's cabin.
Canoo previously reported that it had more than $1 billion in its sales pipeline, a figure largely attributed to a deal with Walmart to purchase 4,500 units, with an option to purchase up to 10,000 units. However, the company struggled to convert those sales into deliveries.
Canoo is essentially a cash-burning pre-revenue company that has had to go back to stock splits and issuing more shares to stay afloat. Last year, the company moved to a different category on the Nasdaq after its stock price fell below $1 and prompted a delisting notice.
