- Canoo stock jumped more than 100% Tuesday as the EV maker announced a deal to sell 4,500 vehicles to Walmart.
- Walmart will use the EVs to fufill online orders and make progress towards zero-emissions goals.
- It could be a course correction for Canoo, which reported a net loss of $346.8 million last year.
Canoo stock surged on Thursday after the electric vehicle maker announced a deal to sell 4,500 delivery vans to Walmart, with the option for the retail giant to purchase up to 10,000.
The stock had surged by as much as 107% shortly after the opening bell, before paring some gains to trade at around $4.55 per share.
Walmart is purchasing the company’s Lifestyle Delivery Vehicle, an electric car designed for frequent stop-and-go trips. The purchase is planned to help the retail chain fulfill deliveries of online orders while making progress toward its goal to eliminate the company’s carbon emissions by 2040.
“We are proud to have been selected by Walmart,” Canoo Chairman and Chief Executive Tony Aquila said in a press release. “Walmart’s massive store footprint provides a strategic advantage in today’s growing ‘Need it now’ mindset and an unmatched opportunity for growing EV demand, especially at today’s gas prices.
The deal could be a course correction for Canoo, whose stock has been on the decline since peaking in November 2020, when the company went public on Nasdaq and announced plans to accelerate its production timeline in the US.
Since then, Canoo has yet to sell its vehicles to the public. Aquila stated that production was constrained due to the chip shortage during the pandemic and higher costs for its materials, Reuters reported. Last year, Canoo reported a net loss of $346.8 million in 2021, up from $86.7 million in 2020.
The vehicles sold to Walmart will be the first of Canoo’s EVs to hit the road, with plans for the cars to be used by Walmart in 2023, according to the company’s statement. Production for the vehicles will begin at the end of this year.