Lion Electric opened with big promises but faded fast

Lion Electric has come a long way and not for the better since it arrived in Joliet in 2021 with the promise of hundreds and hundreds of jobs in the forward-looking industry of electric vehicles.

The Canada-based company this week shut down operations in Joliet, at least temporarily, while dealing with financial problems that threaten its future.

“They used the word ‘suspended’ not ‘halted,” Doug Pryor, chief executive officer at the Will County Center for Economic Development, said of the Lion statement announcing that it would “suspend” operations in Joliet. “Suspended sounds less final to me than some of the other words they could have used.”

Pryor, however, acknowledged that he does not know what’s in store for the Joliet assembly plant for electric buses and trucks.

He suggested Lion management itself may not know as the company tries to resolve financial issues approaching a Dec. 16 deadline on its line of credit.

“The cash crunch is what’s driving this,” Pryor said.

Lion never came close to the job projections it made while getting approval for tax incentives, which included $7.9 million in state tax credits and a 50% abatement in local property taxes.

The tax breaks have never been granted because Lion never met the job targets, state and local officials said.

“Suspended sounds less final to me than some of the other words they could have used.”

—   Doug Pryor, CEO at the Will County Center for Economic Development

Even so, the governor’s office issued a rosy forecast for the Joliet plant after Lion’s latest round of bad news.

“Illinois has made tremendous strides turning the state into a manufacturing hub for electric vehicles and our partnership with Lion Electric continues to be a vital piece of that strategy,” the governor’s office said in a statement issued after the company announced it has suspended production in Joliet.

.“While this measure is temporary, we remain hopeful that Lion will continue to serve as a pillar of the Joliet community, and we are confident their 900,000-square-foot facility will continue to be a standard bearer as the largest all-electric U.S. plant dedicated to medium and heavy-duty commercial vehicle production,” the statement from Gov. JB Pritzker’s office said.

But both state and local officials said they don’t have much to go on besides what Lion Electric has issued in public statements indicating the company needs a cash injection to meet its debt deadline.

In the meantime, other companies in the electric vehicle business have shown interest in the Joliet plant, said Joliet Economic Development Director Paulina Martinez.

“I have already received inquiries about the space if it were to become available,” Martinez said.

Martinez said Lion Electric has stayed in contact with city officials as it deals with its financial problems.

Lion Electric executives appeared to be brimming in confidence when they announced the Joliet project in 2021.

Company representatives at the time upped the 700-employee standard for state tax incentives, promising local officials to have 1,400 workers in Joliet by the fourth year of operation.

That fourth year would start late in 2025, and now it’s not even clear whether Lion Electric will be around by then.

Just how many workers have been employed at the Joliet plant has never been clear.

Lion Electric in July 2023 held a grand opening ceremony with the governor, both U.S. senators from Illinois, and a long line of local officials.

At the time, a plant manager giving a tour of the plant said 250 workers were employed there. But it was unclear how many of them came from temporary hiring agencies, an issue being raised by worker advocates as Lion began operations.

The company since then has repeatedly refused to say how many people were working in Joliet and how many were losing their jobs in layoffs that started within months after the grand opening.

Pryor said Lion Electric’s problems reflect that of a company trying to make its mark in a new and untested market but doesn’t mean the venture itself was a futile one.

“I think they really anticipated being able to sell products in a high-growth market,” he said. “It didn’t materialize as much as they expected. That doesn’t mean it won’t materialize.”

But the incentives have not. Those incentives apparently have failed to kick in because they were tied to actual hiring at the plant.

Just how many people were employed in Joliet is hard to tell because Lion would not provide numbers.