Lion Electric, a company known for its electric trucks and school buses in the US and Canada, is taking steps to reduce costs and improve efficiency. The company plans to save around $25 million annually by letting go of 300 employees, which represents 30% of its workforce across the US and Canada. This move follows a 10% reduction in the workforce last year, as part of the company’s effort to enhance liquidity and move towards profitability.
In response to lower demand for electric trucks, Lion Electric will also scale back its production and shift to a batch-size manufacturing model, producing vehicles only when orders are received. Furthermore, the company intends to sell its batteries to third parties.
Reflecting the decrease in demand for electric trucks and the increase in demand for electric school buses, Lion Electric reported a drop in revenue, with only $30.3 million in the second quarter of 2024 – a significant decrease from the $58 million posted in the second quarter of 2023. The company attributes this decline to poor sales and escalating manufacturing costs, with sales dropping by $12.1 million to $45.5 million in the second quarter of 2024.
The global shift to electric vehicles hasn’t progressed as swiftly as anticipated. Another company, Ola Electric, based in Bengaluru, India, also announced plans to reduce its workforce by 400-500 employees in preparation for its initial public offering (IPO).
