Walmart agrees to order 4,500 Canoo EVs for last-mile delivery

Walmart said Tuesday it signed an agreement to buy 4,500 all-electric delivery vehicles from Canoo, the electric vehicle startup-turned-SPAC that last quarter warned it may not have enough money to stay in business.

Canoo wouldn’t share the financial terms of the deal. However, a spokesperson disclosed that these are binding pre-orders, beginning with Canoo’s branded “Lifestyle Delivery Vehicle.” Under the agreement, Walmart has an option to buy 10,000 units.

Initially, Walmart will use some pre-production EVs to deliver online orders in the Dallas-Fort Worth metro area. Canoo will use this as a test bed to refine and finalize vehicle configuration in the coming weeks. The Lifestyle Delivery Vehicle, or LDV, is expected to go into production in the fourth quarter of 2022 and be on the road in 2023, according to Canoo.

Canoo’s LDV is built on a multi-purpose platform architecture that integrates the motors, battery module and other driving components. Canoo Chairman and CEO Tony Aquila, who is also an investor in the company, previously told TechCrunch that the customizable vehicles are ergonomic, roomy — with about 120 cubic feet of cargo space — and more cost efficient than other delivery vans on the market today thanks to a steer by wire technology that reduces moving parts and cabin intrusion. Drivers inside the vehicle will immediately notice the lack of a traditional steering column and a large windshield that provides expansive views.

The Canoo EVs will be used by Walmart workers to deliver online orders. The EVs may also be used for Walmart GoLocal, the retailer’s delivery-as-a-service business, according to the companies.

Canoo is just one potential piece of Walmart’s increasingly complex delivery system that leverages independent contractors, its own employees, third-party delivery services as well as more futuristic tech like AVs and drones to respond to consumer demands for immediate access to goods. Walmart has pilot programs with AV startup Gatik to use autonomous box trucks to deliver goods from its fulfillment centers to its neighborhood stores. The retail giant is also working with drone companies Zipline and DroneUp.

The upshot: Walmart says it can now reach 80% of the U.S. population with same-day delivery “on a growing assortment of items.”

The EV deal comes about eight months after Canoo announced plans to establish its headquarters and an advanced manufacturing industrialized facility in Bentonville, Arkansas — a city most famously connected with Walmart. Its first manufacturing facility, which is not yet up and running, is located in Pryor, Oklahoma.

Canoo’s decision to located in Bentonville isn’t an accident. Walmart has a history of encouraging suppliers, vendors and even startups it invests in to set up shop in Bentonville.

“We’re encouraged that by being located in close proximity to the Canoo headquarters, we have the advantage to collaborate and innovate in real-time as well as the opportunity to aid in the creation of manufacturing and technology jobs here in our home state of Arkansas,” David Guggina, senior vice president of innovation and automation, Walmart U.S, said in a statement.

This article was originally published on TechCrunch.com. Read More on their website.

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