Canadian Electric School Bus Maker Lion Electric Seeks Financial Rescue
The Canadian electric school bus firm Lion Electric is currently facing financial difficulties and is actively seeking a rescue, as reported by Bloomberg.
Lion Electric recently made the tough decision to lay off 400 employees, which represents over half of its workforce. Additionally, the company announced the suspension of manufacturing operations at its U.S. factory located in Joliet, Illinois. When the factory was initially announced in 2021, Lion Electric had stated that it would be the largest facility for medium-duty and heavy-duty electric vehicles in the United States.
Notably, Lion Electric is among the three companies, including Blue Bird and Thomas Built Buses, that have been at the forefront of delivering electric school buses in the U.S. This initiative is part of a broader effort to replace traditional diesel fleets with cleaner electric alternatives, driven by various state and federal incentives.
Lion A Electric School Bus
According to reports, Mach Capital, the investment arm of Canadian real estate developer Groupe Mach Inc., is currently engaged in discussions to provide much-needed financial support to Lion Electric. In 2023, Groupe Mach and the Mirella & Lina Saputo Foundation were part of a consortium that invested over $90 million (CAD) in Lion Electric.
The Canadian province of Quebec has also extended financial assistance to Lion Electric amounting to 192 million Canadian dollars. Economy minister Christine Frechette has expressed the government’s willingness to offer further funding if the company’s business plan proves viable and if additional private investors come on board.
Lion C Electric School Bus
Lion Electric is part of a select group of manufacturers advocating for the adoption of electric school buses as a sustainable alternative to diesel-powered vehicles. The shift towards electric school buses in the U.S. has gained momentum recently due to enhanced state and federal incentives. The EPA has allocated $5 billion for electric school buses as mandated by the Biden administration’s infrastructure law.
However, uncertainties loom over Lion Electric’s future prospects, especially with the possibility of facing a 25% tariff on auto parts under the incoming Trump administration. There are also concerns regarding the continuity of Biden’s pro-EV policies in the face of potential policy changes. These factors could significantly impact the affordability of Lion Electric’s electric school buses for financially constrained school districts.