EV startup Canoo has added two new suppliers related to the drivetrains that power its electric vehicles, just weeks after the company began a major reorganization that included the resignation of its chief technology officer. is facing a lawsuit.
According to a TechCrunch investigation, Canoo also parted ways with senior director of advanced vehicle engineering Christoph Kutner, who was the last remaining co-founder of the nine-person team that launched the startup in late 2017.
Kuttner is one of nine co-founders who spun off from Faraday Future in late 2017 to launch Evelozcity, the original company behind Canoo. Those co-founders steadily left the company before, during, and after its merger with a special acquisition vehicle in late 2020 to transition from a private startup to a publicly traded company.
Mr. Kuttner and Mr. Kanu did not respond to requests for comment.
The supplier lawsuits were both filed in Michigan's Oakland County Circuit Court in September, and involve Canoo moving away from its original California headquarters and increasing its focus on operations in Texas and Oklahoma, while also expanding into potential domestic customers. This happened at a time when we were in the process of incorporating Britain and the Middle East. All of this is done on a limited budget. The Company reported total cash of just over $19 million as of June 30, 2024, of which $4.5 million was unrestricted.
The two companies suing Canoo are Jing-Jin Electric North America and Dana Limited. Canoo has tapped JJE (Jing-Jin) to design and manufacture electric motors for the EV startup's vehicles. JJE alleges Canoo failed to pay for the motor and owed more than $1.4 million as of August 2023. The supplier alleges that Canoo did not dispute the unpaid money and then “tortured JJE for several months, repeatedly promising to pay JJE and blaming the delay on payments.” Issues and factors completely unrelated to JJE. ”
According to the complaint, in November 2023, JJE and Canoo entered into a repayment plan to resolve the situation. JJE said Canoo made the first three payments totaling $851,013, with additional payments totaling $120,649.23. However, JJE said the payments quickly stopped, even though Canoo owed an additional $446,692.77. JJE suspended all work on Canoo in June 2024, saying the EV startup had stopped responding.
Meanwhile, Dana Limited said it signed an agreement with Canoo in February 2022 to co-design and develop drive assemblies for Canoo's vehicles. Dana Limited said that as part of the agreement, Canoo was required to reimburse suppliers for costs incurred if the EV startup's vehicle production was delayed by more than three months.
“The production and work on the canoes pursuant to the agreement was significantly delayed,” Dana Limited wrote in its complaint. The supplier is now claiming that Canoo failed to make two $4.3 million cost recovery payments in late 2023 and 2024 despite sending “several notices” to the EV startup.