Wisconsin company beats out Workhorse for postal vehicle contract

WASHINGTON - A company with links to Lordstown Motors Corporation has lost a bid to win a multi-billion-dollar contract to modernize the United States Postal delivery fleet.
The Postal Service announced on Thursday that it has awarded a 10-year contract to Oshkosh, WI, based Oshkosh Defense, to manufacture a new generation of U.S.-built postal delivery vehicles.
One of the businesses that had been vying for the contract was the Cincinnati-based Workhorse, a manufacturer of electric vehicles.
Steve Burns, the former CEO of Workhorse and now the CEO of Lordstown Motors said in 2019 that if Workhorse won the postal contract, he would try to convince Workhorse to manufacture the postal vehicles in portions of the same former General Motors Assembly plant in Lordstown where LMC is planning to make the all-electric Endurance pickup trucks.
In 2019, Workhorse signed a three-year intellectual property licensing agreement with Lordstown Motors regarding the Workhorse W-15 electric pickup truck in exchange for an initial equity stake of 10% in LMC.
Workhorse stock, which began the day at more than $31 a share, closed at $17 on Tuesday. On February 6 the stock reached a high of $40.61 per share.
Under the contract’s initial $482 million investment, Oshkosh Defense will finalize the production design of the Next Generation Delivery Vehicle, a right-hand-drive vehicle for mail and package delivery.
Oshkosh will assemble 50,000 to 165,000 of the vehicles over 10 years. The vehicles will be equipped with either fuel-efficient internal combustion engines or battery-electric powertrains and can be retrofitted to keep pace with advances in electric vehicle technologies.
The initial investment includes plant tooling and build-out for the U.S. manufacturing facility where final vehicle assembly will occur.
The contract is the first part of a multi-billion-dollar 10-year effort to replace the Postal Service’s delivery vehicle fleet, one of the world’s largest.
The Postal Service fleet has more than 230,000 vehicles in every class, including both purpose-built and commercial-off-the-shelf (COTS) vehicles.
The NGDV, along with other COTS vehicles, will replace and expand the current delivery fleet, which includes many vehicles that have been in service for 30 years.
The first NGDVs are estimated to appear on carrier routes in 2023.
The NGDV vehicles will include air conditioning and heating, improved ergonomics, and some of the most advanced vehicle technology — including 360-degree cameras, advanced braking and traction control, air bags, a front- and rear-collision avoidance system that includes visual, audio warning, and automatic braking.
The vehicles will also have increased cargo capacity to maximize efficiency and better accommodate higher package volumes stemming from the growth of eCommerce.