Already a player in Canada’s light- and heavy-duty commercial vehicle market, Lightning eMotors is looking to ride new eligibility for federal purchase incentives and additions to its battery-electric transit bus repowering program to greater success

Commercial fleets in Canada are actively looking for electric and other zero-emission alternatives to existing combustion vehicles and demand is outstripping supply.

Colorado-based medium- and heavy-duty zero-emission vehicle manufacturer Lightning eMotors is a recent entry into the Canadian market with two strategies to capture both ends of the market: new buys and retrofits.

“Notable Canadian fleets, customers and partners include Canada Post, GoBolt, Crestline Coach Ltd., Frigid, Annex Distribution, Transmedia, Direct Bore, Cubex, 7Gen, and others, including a major Canadian grocery store chain,” a Lightning eMotors spokesperson told Electric Autonomy Canada, in response to emailed questions.

This month, the company announced that Transport Canada has registered it in its pre-clearance program, which makes Lightning eMotors’ Class 3 to Class 7 electric commercial vehicles eligible for federal commercial vehicle purchase incentives from the government. Lightning confirmed to Electric Autonomy that there are around 50 of its vehicles on the road today in the country and “100 Class 3 and 4 vehicles in backlog order books” and an anticipated additional 1,000 orders in the near-term.

The company also confirmed on a quarterly earnings call this week that they are executing the terms of an August 2022 deal with GoBolt to “manufacture 170 all-electric cargo vans and box trucks over the next 12 months.” The GoBolt vehicles will be deployed across Canada and the U.S. and Lightning says deliveries of the vans are already underway, while the trucks will be delivered in the first half of 2023.

Bullish on Canadian market

“We’re very bullish on Canada,” says Nick Bettis, Lightning eMotor’s director of marketing and sales operations in an interview with Electric Autonomy Canada.

“Canada’s market for electric vehicles is about 20 per cent of what it is in the U.S., but all the data that I’m seeing suggests that a very dramatic uptick in the percentage of vehicles being sold are electric. That’s expected to accelerate. I think that will happen to Canada at least as fast, if not faster than the U.S. So, we’re really excited to be accepted onto the Transport Canada program.”

Lightning’s funding eligibility comes on the heels of a September announcement that the company is now offering a second-generation combustion-to-electric conversion program for 40-foot fleet buses. It’s the latest offering in an electric transit bus conversion program that began in 2018.

“Lightning’s transit bus repower program provides transit agencies a significantly more affordable and faster way to electrify their bus fleets and ensure clean and quiet operation for passengers and pedestrians alike,” said Mac Burns, director of product management at Lightning eMotors in a press statement at the time.

“With increasing pressure to reduce carbon emissions and offer clean transportation solutions, we are confident fleet operators will see the sustainability benefits of converting existing diesel-powered vehicles to electric power rather than letting them end up in a landfill.”

Bus retrofit market burgeoning

Lightning is by no means the only company replacing combustion engines with electric powertrains. Many such programs now exist in Canada, offering fleet operators two related benefits — the opportunity to convert existing emissions-emitting vehicles to zero-emission as well as a strategic workaround for new vehicle supply issues that continue to plague the industry.

Since 2020, Milton Ont.-based MTB Transit Solutions has been converting diesel buses to battery-electric, buying the vehicles, in some cases, an additional 12 to 18 years of use.

Elexicon Group, a self-described “energy solutions provider,” was created in 2019 after a merger between Whitby Hydro Energy Services and Veridian Corp. It offers bus conversion kits as part of its service package, saying on its website: “Repowering diesel buses costs less than acquiring brand new vehicles. Conversion can extend the useful life of a bus, certainly beyond its diesel drivetrain, and still yield the benefits of much lower operating and fuel costs as well as the environmental advantages of no emissions. It’s essentially keeping the diesel bus without the diesel.”

Elixcon did not respond to Electric Autonomy‘s request for an interview.

And Volvo’s subsidiary, Quebec-based motorhome and coach bus maker Prevost, announced earlier this year that, after receiving over $21 million in loans from the Quebec government, it would begin developing purpose-built electric coaches as well as conversion kits to take existing buses from diesel to battery-electric propulsion.

Prevost’s electric offerings — which will require a total $84-million investment (through a combination of company and government monies) to launch — are not expected to be available until 2025.

Across the country, in British Columbia, Riise EV is offering shuttle and bus diesel-to-electric conversions.

“Riise EV offers turnkey electric conversions,” reads the company website. “We work closely with you, to convert your current vehicles and to train your maintenance staff to ensure trouble free operation.”

Riise did not respond to Electric Autonomy‘s request for an interview.

Riise points to government subsidies for bus conversions as an incentive for retrofitting buses to become battery-electric rather than purchasing new vehicles. Under Infrastructure Canada’s Zero Emission Transit Fund, applicants can have up to 50 per cent of eligible costs of a retrofit covered.

Underused opportunity

Despite the availability of conversion programs and the funding available to help finance the work, the approach so far seems to be underused by Canadian fleet operators. To date, there are only a few publicly announced examples of diesel buses converted to battery-electric that are in service.

Many of the conversion companies claim to have made diesel-to-battery-electric conversions for fleet vehicles, but none will disclose their customer’s information (or have not yet brought their conversion technology to market).

Among known examples, BC Transit announced in 2019 that it would begin converting its buses to low-carbon fuel sources. And there are one-off examples of fleet vehicle retrofits (buses and an armoured truck) from diesel-to-hydrogen in Edmonton.

For its part, Lightning says it has not yet performed any transit bus repowering in this country.

“I don’t know if it’s a lack of understanding that that capability is there,” says Bettis who estimates that a repowering, depending on the type of vehicle, can run from $20,000 to $300,000 — roughly a third of the cost of a new vehicle.

“But when you’re looking at a new delivery van or a new motor coach — which is about a million to a million a quarter — you can repower three or four large buses for the cost of one new one. That’s a win all the way around for everybody.”

School bus success

Lightning has had success snagging large retrofit contracts in other parts of the market, however. In August, it announced a partnership with school bus monolith Blue Bird to repower gas- and propane-powered school buses across North America — including in Canada.

“Repowering gasoline and propane Type C school buses is a good solution for school bus fleets that may not have the charging infrastructure in place yet but still need to purchase new buses now,” said Tim Reeser, Lightning’s CEO in a press release. “Being able to purchase new buses with the understanding that Blue Bird and Lightning eMotors can repower them to zero-emissions at a later date with complete charging and telematics support is a great bridge strategy to electrification.”

The companies say the conversions will be done at Lightning’s facilities in Canada and the United States and that a full conversion from initial consultation to completion will take up to 12 weeks. The repower program will launch in 2023 and be offered to Type C buses built after 2021.