EV startup Canoo has been hit with two new lawsuits from suppliers involved in the drivetrains that power its electric vehicles, just weeks after the company began a major reorganization that included the departure of its chief technology officer.
Canoo also parted ways with senior director of advanced vehicle engineering Christoph Kuttner, who was the last remaining co-founder of the nine-person team that founded the startup in late 2017, according to TechCrunch.
Kuttner was one of nine co-founders who spun off from Faraday Future in late 2017 to start Evelozcity, the original incarnation of Canoo. These co-founders have steadily exited the company before, during, and after its transition from a private startup to a public company when it merged with a special purpose acquisition company in late 2020.
Kuttner and Canoo did not immediately respond to requests for comment.
The supplier suit, filed last September in Michigan’s Oakland County Circuit Court, comes at a time when Canoo is moving away from its original California headquarters and increasingly focusing on operations in Texas and Oklahoma while also securing potential customers. UK and Middle East. We’re doing all this on a tight budget. The company reported that it had just over $19 million in total cash 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 tapped Jing-Jin (JJE) to design and build electric motors for its EV startup vehicles. JJE claims Canoo failed to pay for the motors and owes it more than $1.4 million as of August 2023. The supplier said Canoo had not disputed the money it owed and had “kept JJE tied up for months, repeatedly promising to pay JJE and blaming delays on issues and factors that had absolutely nothing to do with JJE.”
According to the complaint, in November 2023, JJE and Canoo entered into a repayment plan to rectify the situation. According to JJE, Canoo paid a total of $851,013 in the first three payments, with an additional payment of $120,649.23. But JJE said payments soon stopped, even though Canoo owed an additional $446,692.77. JJE ceased all work on Canoo in June 2024 and said the EV startup had stopped responding.
Meanwhile, Dana Limited said in February 2022 that it had signed an agreement with Canoo to co-design and develop drive assemblies for Canoo vehicles. Dana Limited said that as part of the agreement, Canoo must compensate suppliers for all costs incurred if production of the EV startup’s vehicles is delayed by more than three months.
“Canoo’s production and work under the contract has been significantly delayed,” Dana Limited wrote in its complaint. The supplier now alleges that Canoo twice failed to pay $4.3 million in cost-recovery payments, despite Canoo sending “multiple notices” to the EV startup between late 2023 and 2024.
