Apple held meetings with California Canoo EV startup in the first half of 2020 as part of the Silicon Valley giant’s secret effort to advance its own electric vehicle project, said three people familiar with the talks. The Verge. The two companies discussed options ranging from investment to acquisition, according to two of the people.
Canoo’s scalable electric vehicle platform, or “skateboard”, was the one that most attracted Apple’s interest, people said. The platform is different from those developed by other startups and larger automakers because it integrates more car electronics, allowing greater flexibility in the cabin design. It also features steer-by-wire technology, which also increases design flexibility and is not yet widely adopted in the industry.
Canoo was more interested in taking on an investment from Apple, two people said. Ultimately, the negotiations failed. Since then, Canoo has become a publicly traded company after merging with a NASDAQ-listed blank check fund in late 2020. Apple has made at least one other acquisition in the mobility space in recent years, buying Drive.ai in 2019.
“Canoo does not openly comment on strategic discussions, relationships or partnerships, unless it is considered appropriate,” said Tony Aquila, Canoo’s chief executive, in a statement to The Verge. Apple declined to comment.
News of Apple’s interest in Canoe arrives when Reuters reports that the technology company is negotiating with Hyundai to make an autonomous electric vehicle as early as 2024. Apple’s vehicle design, codenamed “Project Titan,” has changed shape several times over the years. But the company has now reoriented itself in the manufacture of an autonomous electric vehicle and has been meeting with car manufacturers as small as Canoo and large as Hyundai, to outsource things like technical design and manufacturing.
Hyundai and Canoo previously announced a plan to co-develop electric vehicles in February 2020, although this project appears to be unrelated to the startup’s negotiations with Apple. Canoo refers to his partnership with Hyundai in recent documents with the Securities and Exchange Commission as an “engineering services contract” that will cause companies to jointly develop a platform to power a “small segment electric vehicle”. But Canoo did not reveal whether he was paid for the deal with Hyundai, or if any work has already started.
Canoo was founded in late 2017 by a small group that split from EV startup Faraday Future, including several former BMW executives. Like The Verge first reported, the effort was funded by a Chinese investor who is the son-in-law of a former CCP leader and the family in charge of Taiwanese technology company TPK, which provides touchscreen technology for Apple. Canoo plans to make commercial electric vehicles, such as delivery vans or food trucks, as well as a consumer-oriented van that will be sold by subscription. All Canoo vehicles are powered by the same scalable skate technology.
Negotiations with Apple came at a crucial time for Canoo, who lost $ 182.3 million in 2019 while working on his first prototype vehicle and entered 2020 with just $ 29 million in the bank, according to a recent filing with to the Securities and Exchange Commission.
Canoo met with several companies in Silicon Valley, China and elsewhere in 2019 and 2020, people said. But as the business failed, the startup needed short-term money. He took out a $ 7 million loan from the government’s Salary Check Protection Program and, as negotiations with Apple dragged on, another $ 15 million in total from Pak Tam Li (the Chinese investor) and the Chiang family ( TPK owners) in March 2020, according to the SEC filing.
Canoo has finally started negotiations with the blank check fund, Hennessy Capital Acquisition Corp. IV, at the end of the year. It was one of the first startups to adhere to this trend of using the so-called “special purpose acquisition company” to shorten the traditional path to becoming a publicly traded company. While the deal was closed, the Chiang family invested an additional $ 80 million in the beginning, and the future chief executive invested $ 35 million, according to the SEC filing. Canoo raised about $ 600 million when the deal closed in late 2020.
Although Canoo now has the money he was looking for at the beginning of 2020, it hasn’t eased his ambitions to work with big companies like Apple. The startup said in the same SEC document that it is “currently in discussions with several other leading industry players interested in leveraging Canoo’s technologies and engineering expertise for its own commercial products”.