Lion Électrique temporarily lays off 150 additional employees

The Lion Électrique company temporarily lays off 150 additional employees in Canada and the United States, in all departments of the company.

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As a result of these new layoffs, Lion Electric will have approximately 160 employees who will “primarily focus on helping its customers with the maintenance of school buses and trucks,” the company said in a statement.

The 150 laid-off employees likely received a reprieve during the holiday season. The company was required to implement the workforce reduction as part of its ongoing proceedings under the Companies’ Creditors Arrangement Act, it wrote in a statement.

Last month, Lion made 400 temporary layoffs, in addition to the 150 laid off last year, the 100 last February, the 120 in April and the 350 in July.

Riddled with debt

Quebec electric vehicle manufacturer Lion protected itself from its creditors in December. He was in debt to the point where he simply could no longer meet his financial obligations.

On December 17, the company announced that in the absence of being able to find the money for urgent loans ($30 million to the Caisse de dépôt et placement du Québec [CDPQ] and Finalta, in addition to a loan of $167 million to other lenders), it was thinking of protecting itself from its creditors.

The company carries debts totaling $700 million, including $335 million in long-term liabilities.

While the secured creditors could hope to receive $216 million (including the syndicate of lenders of the National Bank with the Bank of Montreal and Desjardins, $117 million, CDPQ and Finalta Capital, $22.7 million, and the Mach Group, 69 M$), others risk losing big.

Since 2020, the manufacturer of zero-emission vehicles has obtained more than $150 million in public assistance in loans and debentures.

Several small shareholders of Lion Électrique, who will lose thousands of dollars due to the insolvency of the electric vehicle manufacturer, feel helpless in the face of the situation.