WASHINGTON – The USA post Service (USPS) announced Tuesday that Oshkosh Defense will receive a 10-year multi-billion dollar contract to manufacture a new generation of products Post- Delivery vehicles.
As part of the initial investment of $ 482 million, Oshkosh Defense, a unit of Oshkosh Corp., will complete the production design, tests, and vehicle tools required prior to vehicle production.
The contract, which could be valued at more than $ 6 billion in total, provides for the delivery of 50,000 to 165,000 vehicles over a 10-year period, which will be a mix of internal combustion and battery-electric vehicles. Oshkosh had teamed up Ford Motor Co.. based on his suggestion on a transit van.
Current USPS gas guzzling delivery vehicles are, on average, nearly 30 years old. According to an audit report last year, USPS was spending $ 5,000 per delivery vehicle per year on maintenance costs alone.
Oshkosh stock rose 6.1% on the news.
Shares in Workhorse Group, a losing bidder looking to build exclusively electric vehicles at GM’s former Lordstown, Ohio facility, were briefly halted and lost nearly half of their value after the news.
Michael Shlisky, an analyst at Colliers Securities, said Workhorse’s loss of the deal was “really bad news for Workhorse’s youngest investors.”
USPS, which has been planning to replace the current fleet since 2015, said the new vehicles could later be retrofitted with “electric vehicle technologies”.
The USPS fleet has more than 230,000 vehicles, including 190,000 delivering mail.
New USPS vehicles will be delivered in late 2023 and will include air conditioning and heating, improved ergonomics and advanced vehicle safety technology, including airbags and 360-degree cameras. You will be able to move more cargo and handle higher parcel volumes better.
Last month, President Joe Biden promised to replace the US government’s fleet of around 650,000 vehicles with electric models. The White House did not respond to a request for comment on the USPS treaty decision.