Heavy vehicle manufacturer The Lion Electric Company (LEV-T) will slash an additional 120 jobs in its latest round of financial cutbacks, affecting nine per cent of its employees.

“We sincerely regret the impact of this decision on our valued employees. It is however crucial to right-size our workforce to the current environment,” Marc Bedard, CEO and founder of Lion Electric, said in the announcement Thursday morning.

He blamed market dynamics, in particular delays in the Zero-Emission Transit Fund, that negatively impacted electric school bus deliveries.

The Saint-Jérôme, Que.-based electric bus and truck maker said in a release the layoffs will mostly impact its Canadian employees in overhead and product development functions, and is not expected to affect its production capacity.

Lion Electric says it has approximately 1,150 employees following the job cuts, with over 600 positions in manufacturing.

The April layoffs follow the company cutting 150 jobs in November 2023 and 100 jobs in February 2024, also to reduce expenses.

Various cost-cutting measures and the workforce reductions will save approximately $40 million per year, Lion Electric says.

Lion Electric mewed, not roared, in 2023

The company operated at a loss in 2023, despite a year-over-year revenue increase of US$113.6 million. For fiscal year 2023, its net loss stood at US$103.8 million, compared to net earnings of US$17.8 million in fiscal year 2022.

Lion Electric joins other electric vehicle companies, large and small, in facing economic challenges. Tesla laid off 10 per cent of its global workforce earlier this week and Rivian cut one per cent of its employees as well.

Closer to home in Canada, Ford pushed back the start of electric vehicle manufacturing at its Oakville, Ont. factory to 2027, as consumer demand and battery technology has to catch up, the automaker said.

Despite layoffs and its stock falling, Lion Electric’s top five executives, including Bedard, saw their total compensation increase by 32 per cent to $4.7 million in 2023, according to La Presse. The company said it did meet its key objectives such as establishing factories in Joliet, Ill. and Mirabel, Que., launching new school bus and city truck models, and certifying a battery model.

There are, however, conditions on the compensation: Bedard, for example, agreed to not receive a $427,029 cash bonus and will instead have it converted into stock options. If Lion Electric continues to miss other expectations based on factors like its stock price, the compensation may not be given, La Presse reported.