Friday, November 15, 2019

New Business Model for Electric Vehicles

a new BEV startup revealed its products and strategy last week in Torrance, California, not far from Tesla’s Southern California operations.  The company intends to market a subscription-based compact minivan-sized BEV—or as Canoo descries its vehicle—an “Urban Loft on wheels,” starting in 2021.

Canoo EV
Two Canoos to view

Founded in 2017 by ex-BMW and Über BEV executives, several of whom did a stint at Faraday Future, Canoo hopes to take the BEV to a new level with a subscription-based direct-sales model to customers. The subscription is envisioned as a month-to-month model that includes services such as registration, maintenance, insurance management and charging.

Canoo’s global headquartered, where it currently has approximately 400 employees, is in a 90,000-square-foot building in Torrance, California, which also houses the R&D facility and design studio. The company has been based there since May 21, 2018. The company also has an office in Silicon Valley, a Chinese headquarters in Shanghai and will utilize contract manufacturing and support partners.

“We believe that the potential of EV architecture can enable a post-SUV era that addresses the ever-growing desire for space and value,” said Ulrich Kranz, co-founder and interim CEO at Canoo. “We promised a truly different approach for EVs, and our Canoo proves that we can deliver on that vision. The unveiling also kicks off the period of beta testing, meaning we are on track for our launch date in 2021. We are very proud of the team. In my 30 years’ experience, I have never seen so many quality achievements in such a short time.”

Another Skateboard

Canoo vehicles will be built on a proprietary “skateboard” architecture, directly housing the batteries and electric drivetrain. All of Canoo’s vehicles will share the same underpinning and different cabins or “top hats” can be married on top to create unique vehicles. Leveraging the same fixed and flat skateboard allows for reduced research and development costs, efficient production and a better use of interior space. The Canoo is initially expected to have an EPA range of 250-300 miles.

Canoo EV
The Canoo looks ready to go from car to living room

Described as “autonomous-ready,” Canoo vehicles feature advanced driver assistance systems (ADAS) and driver monitoring systems, including five radars and 12 ultrasonic systems for Level 2+ autonomous capabilities. The Canoo will integrate these systems with a steer-by-wire system that has no mechanical connection between the steering wheel and wheels.

Canoo says that its vehicle design is currently completing validation testing with beta fleet testing in starting in October 2019 and a goal of first subscriber customers in 2021.

Canoo EV
Underneath it all–batteries & motors down low

Canoo will be unveiling its vehicle to the public at a Southern California event, at the Art Center College of Design in Pasadena, California, on October 20.

While the Canoo design and business model is appealing to today’s millennial, the proof will be in the difficult task of bringing the business and product to market.  The details are sketchy at this time, but we will be following this story as it develops.

Canoo Company Overview


Canoo is a Los Angeles-based company creating electric vehicles (EV) for subscription only. The first vehicle Canoo is unveiling will launch in 2021 and was designed for a world in which transportation is becoming increasingly electric, shared and autonomous.

• Electric – Canoo makes unique EVs affordable for inhabitants in cities world-wide.

• Shared – Canoo’s first vehicle capitalizes on the EV architecture in a way that provides more interior space – making ridesharing even more comfortable.

• Autonomous – Canoo will be class-competitive regarding autonomous driving and will feature a Level 2+ system. The car is prepared for full autonomy as technology evolves.

Canoo EV
Canoo’s vision is a line up of EVs


Canoo is challenging the traditional way of building, using and offering vehicles based on a threefold approach:

• A new business modelthat focuses on reducing production and infrastructure costs to make EVs more affordable to customers.

• A fresh designcapitalizing on the space EVs provide, looking like nothing on the road today and challenging the norms of space and function. The unique design points to the future of cars that are electric and autonomous.

• A subscription modelthat puts an end to ownership, providing a hassle- and commitment-free car experience in modern cities.

Canoo EV
The subscription model reduces the commitment of the vehicle user


Canoo was founded in December 2017 by a group of experienced automotive executives and engineers. The team has since been commended by various experts from successful tech and car companies. Today, Canoo has grown to around 400 team members—covering the entire value chain, bringing together a unique EV with a unique business model for a unique User experience.


Canoo frees its subscribers from the hassle and commitment of car ownership, saves them time and enables a more efficient way to use a car. By providing an attractive EV at an affordable price via its subscription model, Canoo can reduce carbon emissions and increase the usage of cars.


Canoo EV
Canoo’s design philosophy leans toward the functional

There is no need for electric vehicles to look like traditional cars, yet today they still do. Canoo plans to change that. By leveraging the benefits of a flat EV platform, Canoo can create unique vehicles that look nothing like what is on the road today. Canoo’s vehicles will move away from traditional three-box car design, which have separate compartments for the engine, passengers and luggage. Instead, the Company is embracing a minimalist design that maximizes interior space. Canoo’s first vehicle will have the exterior footprint of a compact car, with the interior space of a large SUV.


Traditional car makers have an outdated approach that is focused on proprietary infotainment systems and overwhelming screens, but most customers just want to use the very same services they are used to having on their phones when inside the vehicle. Rather than reinventing the wheel, Canoo is developing a lean user interface that easily connects with the user’s own existing digital life.


Building electric vehicles is expensive, therefore, Canoo is rethinking the traditional automotive business model. Canoo’s cost structure is very lean. The company is focused on lowering costs and generating higher revenue through:


Canoo EV
Motors sit between the wheels

Canoo is developing a “skateboard” architecture, which will house a battery and electric drivetrain that can achieve up to 300 miles of range. All of Canoo’s vehicles will share the same underpinning. Different cabins or “top hats” will be married on top to create four unique vehicles. Leveraging the same fixed and flat skateboard allows for reduced R&D costs, efficient production and a better use of interior space. The skateboard houses the most expensive components of the vehicle and is designed in a way that most crash testing does not need to be repeated per vehicle, reducing the vehicle’s development cycle timeline and costs.


Electric powertrains inherently have a long, low-maintenance life. This, combined with the fact that Canoo won’t sell its vehicles, allows the company to depreciate the assets over a longer period of time compared to traditional car companies. The benefit is a lower monthly subscription cost for subscribers. The company will take cues from the airline industry and refurbish the vehicles to keep them up-to-date over their lifecycle.


Canoo is asset-lean. The company will use contract manufacturing to outsource production.


For areas like autonomous driving that require very specialized expertise, Canoo is working with leaders in many fields to integrate the latest technologies into the vehicles to offer the best possible product experience to its subscribers.


Canoo EV
Canoo will look to partners for some expertise

Canoo will not have a physical sales network. The company will offer its product directly to customers.


Canoo believes that there is a better solution than traditional car ownership. Instead, Canoo will free its customers from the burden of ownership by offering a hassle- and commitment-free EV subscription for one monthly, affordable price and with no set end date. The subscription may include services such as registration, maintenance, insurance management and charging—all from a single app. Canoo brings the convenience and affordability of the well -known month-to-month subscription model to the car industry, providing consumers with the convenience and value they deserve.

Company Facts


The company started in December 2017.


Canoo will launch its first vehicle in Los Angeles, CA, starting in 2021.


Canoo is headed by industry leaders:

• Ulrich Kranz—In Charge of Canoo; former head of BMW i

• Richard Kim—In Charge of Design; designer of the BMW i3, i8 Coupe & i8 Spyder

• Olivier Bellin—In Charge of Operations; former VP of supply chain at Icon Aircraft

• Clemens Schmitz-Justen—In Charge of Manufacturing; former president of BMW manufacturing USA

•James Cox—In Charge of Product Technology; former global head of product operations at Uber

• Stefan Krause—Chairman of the Advisory Board; former CFO of BMW and Deutsche Bank

Canoo intends to market a subscription-based compact minivan-sized BEV—or as Canoo descries its vehicle—an “Urban Loft on wheels,” starting in 2021.
In the rear the Canoo looks like more of a lounge than a car


Canoo currently has approximately 400 team members from various industries and backgrounds.


Canoo’s global headquartered is in Los Angeles. The company also has an office in Silicon Valley and a Chinese headquarter in Shanghai. The company’s global headquarters is located in a 90,000 square foot building in Torrance, California. It also houses the R&D facility and design studio. The company has been based there since May 21, 2018.

Gary Lieber is a Road Test & Technology editor at Smarticd. Gary is a Silicon Valley technology veteran, having spent more than 20 years as an executive at Apple and Microsoft. He is a life-long technologist, club racer and gearhead. He has written about cars for the last 10 years, focusing on battery electric cars, autonomous vehicles and the technologies behind them. He is an organizer of Silicon Valley Reinvents the Wheel, founder of the San Francisco Bay Leaf Owners Association, former Concours Chairman for the Porsche Club of America and currently serves as Vice President of Communications for the Western Automotive Journalists.

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