Lion Electric, a Canadian electric school bus manufacturer, is fighting for survival. The company announced layoffs of 400 workers, over half of its staff, and paused operations at its Joliet, Illinois, factory. This facility, once touted as the largest U.S. plant for medium- and heavy-duty EVs, now stands idle—a major blow to the company’s future.
Struggles Amid High Demand
Lion is a key player in the U.S. electric school bus market, alongside competitors Blue Bird and Thomas Built Buses. State and federal incentives have driven demand for cleaner alternatives to diesel buses, making Lion a critical part of the transition. Yet financial troubles now threaten its position.
Search for Financial Lifelines
Mach Capital, the investment arm of Canadian real estate developer Groupe Mach Inc., is reportedly in talks to provide new funding. In 2023, Groupe Mach and the Mirella & Lina Saputo Foundation invested over $90 million CAD in Lion. The Quebec government has also pledged $192 million CAD, with officials expressing a willingness to invest more if private backers support the business.
Policy and Tariff Concerns
Federal incentives, including $5 billion from the EPA under the Biden administration’s infrastructure law, should bolster Lion’s market. However, uncertainty looms with a potential 25% tariff on Canadian auto parts under the incoming Trump administration. Such tariffs could significantly raise costs for Lion’s buses, making them less affordable for school districts. Additionally, changes to EV-friendly policies under a new administration could create further obstacles.
A Vital Role in Sustainability
Lion has been pivotal in advancing electric school buses as a replacement for diesel models. Its vehicles offer quieter, cleaner options for school districts aiming to reduce emissions. Yet financial instability and policy uncertainties could derail its mission.
The Road Ahead
Lion Electric’s survival depends on securing funding and adapting to shifting political and economic landscapes. With the demand for electric school buses growing, the company’s fate will have wide-reaching implications for sustainable school transportation in North America. The stakes have never been higher for this trailblazing manufacturer.
