Lion Electric secures loan of up to 7.5 CAD

Lion Electric announced a new loan agreement with Investissement Québec for up to 7.5 million Canadian dollars. The electric commercial vehicle maker also announced final certification of its LionBattery heavy-duty battery pack.

The new loan of 5 million Canadian dollars (about 3.34 million euros) from Investissement Québec was provided under the ESSOR programme. The manufacturer says it can be increased to 7.5 million CAD under certain conditions, though it did not specify which ones. The loan has an initial term of three years and a fixed interest rate of 13 per cent.

The Canadian manufacturer also announced some modifications to some of its senior credit instruments with the National Bank of Canada, the Bank of Montreal, the Fédération des caisses Desjardins du Québec, Finalta Capital, the Caisse de dépôt et placement du Québec, as well as others. As part of the amendments to its revolving credit agreement, an agreement under which the borrower can borrow on an ongoing basis while repaying the balance in regular payment, Lion Electric will not have to report its financial covenants, “namely the tangible net worth test and the springing fixed charge coverage ratio.” However, the manufacturer will be required “to maintain a minimum amount of available liquidity” of 15 million Canadian dollars (10.2 million euros).

This comes as Lion Electric announced a workforce reduction of about 10 per cent at the end of last year in the US and Canada.

But the manufacturer had more good news to share. “The LionBattery HD pack is now certified to meet the most rigorous criteria and safety regulations in the automotive industry,” Lion Electric writes. The battery has a capacity of 10 kWh and will be used in the all-electric Class 8 Lion8 tractor, which the company unveiled in May. The medium-duty, or MD, variant received certification in December.

“This advancement underscores our dedication to excellence, reliability and safety, solidifying our leadership role in North America’s transportation electrification landscape, as the battery serves as a critical component of the vehicle,” says Marc Bedard, CEO-Founder of Lion. “With major battery development milestones behind us, we will now focus on optimizing the integration of both the LionBattery MD and HD packs on our vehicles, which should ultimately translate into production efficiency.”

thelionelectric.com (credits and loans), thelionelectric.com (LionBattery)