In a significant blow to the Biden administration's green energy agenda, Canadian electric bus manufacturer Lion Electric, which received a hefty $159 million from the U.S. government to produce 435 school buses between 2022 and 2024, has declared bankruptcy.
The company's financial collapse has left hundreds of undelivered buses and a fleet of electric vehicles that can no longer be serviced due to the company's insolvency. Consequently, many school districts are reverting to diesel-powered buses, undermining the very purpose of the Clean School Bus program.
According to The Washington Free Beacon, Lion Electric, which was on the brink of bankruptcy earlier this year, had failed to deliver $95 million worth of electric buses it had committed to produce under the Biden administration's $5 billion Clean School Bus program.
The company, once valued at $4.7 billion in June 2021, was sold for a mere $6 million during bankruptcy proceedings. Lion Electric also closed several manufacturing plants, laid off most of its workforce, and informed customers that it could no longer honor warranties and purchase orders in the United States.
The company's rapid decline underscores the challenges associated with the Democrats' green energy policies, particularly as school districts are forced to revert to diesel-powered buses, which the Clean School Bus program aimed to phase out.
Mike Leskowich, superintendent of the Homer Community School District in southern Michigan, expressed his disappointment, stating, "All of our contacts from Lion that we worked so closely with to ensure the project's success have been fired." He added, "We are going to keep our electric fleet on the roads for as long as possible. Eventually, however, we will return to diesel, as the cost of the vehicle is far less than electric."
The Clean School Bus Program, established by the Democrats' 2021 infrastructure bill, was one of the Biden administration's flagship climate initiatives. The program was promoted by then-Vice President Kamala Harris in 2022, who nostalgically remarked, "Who doesn't love a yellow school bus, right?"
However, the reality of transitioning from diesel-powered buses to electric ones has proven to be a daunting task for many school districts. The average cost of an electric bus exceeds $350,000, while a new diesel-powered bus typically costs around $100,000, according to environmental think tank Resources for the Future. Moreover, the transition requires significant investment in high-powered charging infrastructure and new training for drivers.
The technical and safety issues associated with Lion's electric buses have led several school districts to remove them from service. A Midwest school district superintendent told industry publication Clean Trucking that the district's buses had numerous mechanical problems, including the inability to heat up in cold weather, loss of steering and braking ability, defective frames, and frequent error messages that required drivers to reset the vehicles.
School officials who were promised Lion buses by the Biden administration are losing hope of ever receiving their vehicles. Dawn Wallace, superintendent of the Ohio Valley School District in Adams County, Ohio, stated, "We have not received any buses. At this point, we are not really hopeful that we will. We will maintain our diesel-powered fleet and, yes, continue to purchase those in the future."
The Environmental Protection Agency (EPA) is closely monitoring Lion's bankruptcy proceedings and "evaluating all options," according to spokeswoman Brigit Hirsch. However, Travis Fisher, director of energy and environmental policy studies at the Cato Institute, suggested that the issues arising from Lion's situation were foreseeable consequences of the Biden administration's policies.
"For anyone who thought the transition to EVs would be easy or even profitable, this is yet another example that perhaps there will be large bumps in the road," Fisher said. This situation serves as a stark reminder of the potential pitfalls of transitioning to green energy, particularly when the transition is driven by government mandates rather than market forces.
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