Canadian Lion Electric is on the brink of liquidation following Quebec’s withdrawal of financial support

Quebec-based manufacturer of electric school buses and trucks Lion Electric appears headed for liquidation after the provincial government ruled out further investment in the company, is reported on CBC News.

The decision effectively ends any prospect of a restructuring or sale, according to Jean-François Nadon, the Deloitte restructuring specialist appointed as court monitor in the company’s insolvency proceedings, as quoted in the article.

Lion Electric filed for creditor protection on December 18, 2024, with debts exceeding $411 million.

Lion Electric nears liquidation

Reportedly, last week Lion laid off nearly all its staff, retaining just 12 employees. The company is reportedly still able to pay wages, but failed to cover rent across its facilities on May 1, missing approximately $400,000 in payments.

The final blow came when the Quebec government rejected a $24 million funding request from a group of potential buyers interested in relaunching the company. Nadon confirmed in court that government backing was a necessary condition for the proposed deal to move forward. Without public investment, he added, the likelihood of a buyer stepping in has become “very low.”

Economy Minister Christine Fréchette justified the province’s position by citing the need for greater private sector engagement. Premier François Legault echoed this stance, noting that Quebec has already invested around $140 million in Lion Electric and suggesting that the global context—particularly the return of Donald Trump to the U.S. presidency—has introduced heightened risks to the province’s electrification goals. Legault indicated the province may need to reassess its targets for zero-emission transportation given the shifting policy environment in the U.S.