Canoo Inc. went public in 2020 with a $2.4 billion valuation and big promises to disrupt commercial EVs. But just four years later, the startup went bust after repeated delivery delays and operational failures.
Shares of Canoo, trading under the ticker GOEVQ, were halted in January when the company filed for Chapter 7 bankruptcy.
It was a frustrating end for a company that had secured a high-profile order from Walmart for 4,500 delivery vans, yet failed to deliver a single one.
Canoo also planned to operate from a 270,000-square-foot facility in Bentonville, Arkansas, according to SEC filings, but that deal fell apart as well.
Canoo isn’t the only EV startup that is struggling. It’s a symptom of a broader shakeout among small-cap stocks in the electric vehicle space.
Once-hyped startups like Lucid (LCDI), Fisker, Nikola (NKLA), Lion Electric (LEVG), Proterra (PTRA), and Lordstown Motors (NRDE) have all struggled to scale and survive in an increasingly competitive market.
Meanwhile, legacy automakers are pulling ahead.
8 out of 10 top EV makers are legacy automakers
Despite early buzz and billions in funding, most EV startups have failed to compete with established players that have the resources to endure long development timelines and massive capital requirements.
Eight of the ten best-selling EV manufacturers in 2025 are legacy automakers.
While Tesla still leads U.S. EV sales, it’s one of only two pure-play electric vehicle companies — the other being Rivian — in the top 10.
Tesla is estimated to have sold 128,100 vehicles in Q1 2025, according to Car Edge. The rest of the list is dominated by familiar legacy automakers:
- General Motors (31,887)
- Hyundai Group (22,995)
- Ford Motor Company (22,550)
- Volkswagen Group (19,827)
- Honda Motor (14,374)
- BMW Group (14,234)
- Rivian (8,640)
- Toyota Motor (7,064)
- Nissan (6,741)
The rise of Honda and Toyota has been especially striking. Neither sold EVs just a few years ago, and Honda didn’t log a single EV sale until Q2 2024. Yet now, both are outselling Rivian.
VCs are bailing, too
It’s not just individual investors losing faith in small-cap EV stocks. Venture capital funding for electric vehicles and clean energy ventures has fallen off the cliff since 2022, according to Oliver Wyman.
The consulting firm cited a "cooling" in investor appetite — driven not only by macroeconomic headwinds but by the booming hype around AI.
“The lure of AI startups dampened the fervor for sustainable energy among VC investors,” Oliver Wyman said.
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