The manufacturer of 100% electric trucks and buses Lion is reducing its workforce by 10%.
This decision affects 150 of the 1,500 employees of the company based in the Laurentians. Lion also operates facilities in the United States.
By making layoffs, managers claim they want to reduce costs and improve the ability to achieve profitability objectives.
The jobs affected by the measure are mainly production support, product development and administration functions, in Canada and the United States.
A Lion spokesperson told The Press that management was not granting interviews on Monday. Founder and CEO Marc Bédard simply emphasized that downsizing makes the most sense for the company at this point.
Lion has therefore not revealed the extent of the savings that will be made by the departures. More details will be expected during the year-end performance presentation in three months.
CIBC analyst Kevin Chiang, however, does not expect severance costs to be significant.
This expert recalls that during the conference call held on the sidelines of the unveiling of the third quarter results, at the beginning of the month, management announced that it had postponed the commercial production of Lion A school buses in order to give priority to production sales of vehicles in high demand (140 Lion A school buses were removed from the order book).
“The move is part of the company’s strategy to accelerate production by focusing on the most in-demand models, rather than spreading its resources across many different models. »
The announcement of the layoffs was timidly received by investors. Lion’s shares lost 4% during the first trading session of the week, closing at $2.19 on the Toronto Stock Exchange.
Lion announced at the beginning of the month that it had widened its net loss to US$20 million during the months of July, August and September on revenues of US$80 million.
In its activity update, the company then highlighted the start of construction of its Lion D buses at its plant in Joliet, Illinois, and its Lion 5 trucks in Montreal.
Lion entered November with a total of 12 experience centers operating across Canada and the United States.
Management also warned investors that nearly half of the order book was at risk because of Ottawa’s slowness in processing subsidy requests.
The order book numbered 2,232 vehicles (1,964 trucks and 268 buses) as of November 6.
In July, the company completed financing operations which brought in approximately 142 million.
Founded in 2008, Lion made a notable IPO in the spring of 2021. Its shares then quickly reached a peak of $28 before falling to a low of $2.09 three weeks ago. This year alone, the stock has seen a stock market decline of almost 30%.