EV Vehicle Startup Canoo Announces Headquarters Move From Torrance To Dallas/Ft. Worth Area

EV vehicle startup company Canoo, well known for their snub-nosed vans and trucks, announced on Monday that they will be moving their company from Torrance to Justin, Texas, an outer ring suburb of Fort Worth.

Started in 2017 in Torrance, Canoo unveiled several prototype vehicles in the following years, each with a distinct snub-nosed look to them. Following a failed move to Arkansas in 2021 when a deal with Wal-Mart fell through, Canoo stayed in California, but increasingly looked outside of California due to high costs. Instead they opted to stay in California, but with a greater focus in the central United States. This included building new facilities in Oklahoma and Texas, as well as construction of a new factory in Oklahoma.

While they had not greatly expanded out and go more commercial, Canoo did slowly grow in the last several years. This included a U.S. Army contract in 2022 to test one of their pickup trucks, as well a contract with the U.S. Postal Service in May to test 6 vans in the Atlanta area. However, poor second quarter results this year revealed that the company had less than $20 million to run on, with a low amount of revenue coming in. Needing a way to reduce the bleeding of funds, Canoo announced that they will be moving the company to the cheaper confines of Texas, with only 70% of their workforce being offered relocation there. In addition, their Chief Technology Officer left the company shortly after the announcement, leaving the company in an odd financial area.

Canoo’s departure follows in the footsteps of Elon Musk’s previous companies. Partially due to the high costs in California, Musk moved the headquarters of his electric car company, Tesla, from Palo Alto to Austin, Texas in 2021. However, unlike Canoo, Tesla is still very much in California, with dozens of dealerships, several factories, and a large number of offices and employees still being based in the state. This year, Musk also announced his move of Hawthorne-based Space X to Texas, while at the same time, leaving many offices and employees in the state.

Canoo, being a small company that has so far hand-built all their current cars and aren’t even commercially available, only has several hundred employees This allowed them to make a complete move on Monday. However, auto experts told the Globe that the move may not save them.

“The move is sort of a desperate attempt to stay alive, with them cost-cutting everywhere,” explained Anthony Ferry, a San Francisco tech consultant, to the Globe on Monday. “For Tesla, keeping a large California presence, despite the costs, makes sense. The Fremont factory ensures cars quickly going out, and the high number of electric vehicles on the road in California ensure a need for many employees to be there. Musk, despite everything, understands how important California is for his company. He can afford moving the company out of the state. He can’t afford isolating Californians with a complete pullout.

“Canoo’s move is way more strategic. Their financials aren’t good and they are squeezing every penny. They already have offices in Justin, so going closer to the factory while leaving the expensive Los Angeles area will save them money. Had they had commercial production going, they would have left some sort of contingent in California, as they are by far the largest EV market in the U.S.

“They have about $19 million for runway funds right now, and the factory isn’t even up and running. The move saves them a bit and gives them more time. This isn’t a screw you to California. It’s just strategic. And other startups might follow up like this.”

As of Monday, it is currently unknown when move finalization will take place.