Canoo (NASDAQ: GOEV) stock soared 50% on Monday following the approval from the U.S. Department of Commerce for its Oklahoma City facility to operate as a Foreign Trade Zone.
Canoo (GOEV) has announced that the Free Trade Zone (FTZ) designation promises significant benefits for the company, including customs duties elimination on international vehicle sales and the deferral of duties on imported parts used in domestic sales. With over 90% of its parts sourced from the U.S. and allied nations and 70% from North America, Canoo expects this designation to slash international vehicle costs by up to 5%. Moreover, the FTZ status will defer customs duties until the vehicles are delivered to customers, improving working capital for domestic sales.
Tony Aquila, Executive Chairman and CEO of Canoo, said this about the FTZ designation:
“We are proud to announce that we have achieved another important building block in our strategy by creating one of the largest Foreign Trade Zones in the State of Oklahoma. This FTZ will generate economic growth, American jobs, and have a long-term permanent financial benefit to working capital and cost of materials.”
Canoo has outlined plans to expand its manufacturing footprint in Oklahoma to bring more supply partners in proximity to its facility. The company’s manufacturing strategy focuses on owning the supply chain, setting it apart from competitors who outsource these operations.
Furthermore, Canoo aims to secure approval for its remaining manufacturing facilities in Oklahoma, with plans to establish one of the largest FTZs in the state. This expansion will create numerous high-paying direct and indirect jobs, bolstering the growth of the advanced manufacturing sector in the heartland of America.
Canoo (NASDAQ: GOEV) Stock Price Action
GOEV stock surged 49.48% to close at $2.90 on Monday. The traders had exchanged hands with 108,380,128 (108.38 million) shares compared to the average daily trading volume of 5.59 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
