Lion Electric announces additional layoffs
The goal of the so-called ‘Action Plan’ is for Lion Electric “to streamline its operations, further align its cost structure with current demand and improve its liquidity position and ability to reach its profitability goals.” 30 per cent of the workforce, roughly 300 employees, across the US and Canada will be affected. Moreover, the manufacturer emphasises that it will impact “all areas of the organization.” According to Lion Electric, the move will save the company around 25 million dollars per year.
Lion Electric had already announced a workforce reduction in the US and Canada of about 10 per cent at the end of last year.
Another way for the company to save money is to downsize its production, as demand for electric trucks in North America is lower than Lion Electric anticipated. It will thus adopt “a batch-size manufacturing approach,” meaning that it will only build the electric vehicles if they have been ordered. Moreover, Lion Electric wants to sell its batteries, the LionBattery HD pack, to third parties. To that end, the company will establish a new product line.
The LionBattery HD pack, which has a capacity of 10 kWh, just received certification in June. It 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.
“Transition to electric is taking longer than initially expected, but transportation electrification is here to stay. It is with that mindset that we have put together an action plan to adjust our cost structure to enable us to continue to support the increasing electric school bus demand and maintain our leadership position, while allowing us to keep supporting the truck operators in their electric transition and focus on our profitability objectives,” says Marc Bedard, CEO-Founder of Lion.
And Lion Electric is desperate for income. The manufacturer just reported its financial results for the second quarter of 2024. It made $30.3 million in revenue in Q2 – down 27.7 million dollars compared to the same period last year. Sales also declined by 12.1 million dollars YoY to $45.5 million in Q2/2024. “The decrease was primarily due to lower sales volumes, partially offset by increased manufacturing costs related to the ramp-up of the new products (LionD, Lion5, and the Lion battery packs),” Lion Electric states in its press release.
Lion Electric is known for both its electric trucks and school buses, which are very popular in the USA and Canada. The company made its start with heavy-duty electric buses, before transferring the technology to truck production.
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