What led to the creation of GreenPower and how did you experience the journey so far?
I have been an investor in an early-stage company that was a predecessor to what is now GreenPower, and while brainstorming for alternative propulsion systems, battery electric came up as the most disruptive future technology, with a majority of votes. At that time, in 2011, there had not been any medium or heavy-duty full electric vehicles deployed in North America, and although these were very early days, we found the courage to bring to market the first 40-foot low floor transit bus. As it turned out, that has not been the best idea, but, nevertheless, we managed to expand our product catalog in the Class 4 space, between the light-duty Class 1 to 3 that is populated by so many companies, and the shiny bauble that is the Class 8 truck. Ten years ago, we thought that improvements in batteries were going to be faster than they were, and that we would be getting to where we are today sooner than we have. Regardless of these delays, we still managed to find our path and even score some successes along the way.
The spark that led to the electrification trend in North America was a combination of money and mandates. The EPA School Bus Program that kicked in in 2022, and the IRA $40,000 tax credit inaugurated this year are pushing the envelope in this space by a lot. On the mandate side, the state of New York, for example, plans to have all school buses battery electric powered by 2035, and starting with 2027, all new purchases have to, also, be fully electric. Although this demand for products like ours comes in with a little delay, we are glad to be here and able to respond to it.
This growing demand means you need to grow your production; to what extent are you ready for this scale up?
Five years ago, all of our sales would have been on the West Coast and in the state of California, where we were a well-known regional player. Feeling the need to expand our footprint, we undertook looking for a production-ready property in a state where we could benefit from support from the local legislators. After thorough research, we found West Virgina as being a safe haven where we could partner with the government to acquire a 80,000 square feet facility. Unlike other players in this space, we have not had any CapEx expenditures as we were able to obtain a lease agreement which, after five to six years, will transfer the title of the property to us. This facility will be our center of excellence for the school buses business, and we actually already started production of 25-foot Type A Nano BEAST School buses here. Besides these, the state governor set up a pilot project through which they bought three Type D BEAST 40-footers, where they moved them all around the state to drive the large-scale adoption of EVs. We have now covered almost half of the school districts as measured by number of school buses and students, and then the state also ordered over 40 new school buses on a $15 million contract. Given that we design and develop our own cabin chassis and that we have our own supply chain, we managed to put up a gross profit in this day and age when the majority of our peers are reporting losses.
Is the green transition going in the right direction?
The demand in our sector has out stripped production today, and everyone that has a good quality product and a good distribution network is able to place it into the market. From a policy point of view, we feel that the right levers are pulled only now, versus before when it was more of a horizontal approach. I have always felt that battery electric vehicles will succeed given that there are plugs all over the world, so the ease of use is always going to be there.
Was there a specific moment when you realized that what you are doing through GreenPower is really impacting the world?
Of all the areas that we serve, electric school buses is a sector that has measurable health benefits. The research shows that preschoolers that ride diesel buses, for 45 minutes to and from kindergarten, are up to 15 times more prone to respiratory diseases and even lung cancer. Moreover, they are reportedly more tired once they get to the classes in the morning due to the emissions and loud environment of an ICE bus. The pandemic created new expectations, and now mothers in particular across the U.S. are demanding their children are taken to school in zero-emission electric buses.. Being part of this revolution, and even setting the bar for the newcomers, is extremely exciting, and we hope that we will be able to live up to society’s expectations as we are going forward.
