Days after laying off dozens of its employees without pay, electric vehicle startup Canoo told the rest of its staff they will be on “mandatory unpaid furlough” until at least the end of the year. TechCrunch reported Friday. A company email seen by the outlet said employees would be locked out of Canoo's systems at the end of Friday and their benefits would continue through the end of this month.
The report follows that of Canoo advertisement last week that it was shutting down its Oklahoma factories and laying off employees as it worked “to finalize obtaining the capital necessary to continue operations.” As TechCrunch notes, the company reported that it only had about $700,000 left in the bank last month.
Also on Friday, the company announced a 1-for-20 reverse stock split, effective December 24. Canoo says the consolidation is aimed at keeping its shares listed on the Nasdaq exchange and attracting “a broader group of institutional and retail investors.”
Canoo was founded in 2017 to sell electric vans and trucks to adventure-seeking customers, but has mostly only made vehicles for the US government such as The edgeAs Andrew Hawkins wrote last year, analysts have warned about its risk of insolvency as it is on the verge of running out of cash from 2022. Canoo has lost a steady stream of executives since then, including all its founders and, most recently, its chief financial officer and general counsel.
