Oshkosh beats Workhorse for Postal Service delivery vehicle contract

It’s Oshkosh, by gosh

Oshkosh, based in the Wisconsin city of the same name, makes off-highway equipment, refuse and severe service equipment in addition to military vehicles. The Oshkosh M-ATV is a mine-resistant ambush-protected vehicle for the MRAP All Terrain Vehicle program intended to replace the M1114 HMMWVs, known as Humvees.

The Postal Service said little and discouraged companies in the running from talking about the bid process. Oshkosh recently related to investors its willingness to make battery-electric-powered vehicles if that is what the Postal Service wanted. 

The heavy equipment maker partnered with Ford Motor Co. (NYSE: F), which recently announced an electric version of the Transit van built at its Kansas City Assembly Plant in Claycomo, Missouri.

“Oshkosh operates with unparalleled commitment to those who depend on our products and services to build, protect and serve communities around the world,” John Pfeifer, Oshkosh president and chief operating officer, said in a press release.

The third finalist was Turkish commercial vehicle builder Karsan. It teamed up with bodybuilder Morgan Olson.

Modern upgrade

The 10-year contract begins with a $482 million investment. With that money, Oshkosh Defense will finalize the production design of the  purpose-built, right-hand-drive vehicle for mail and package delivery.

It will assemble 50,000 to 165,000 NGDVs over 10 years. The vehicles will be equipped with either fuel-efficient internal combustion engines or battery-electric powertrains capable of being retrofitted to keep pace with advances in electric vehicle technologies. 

The initial investment also includes plant tooling and build-out for a U.S. manufacturing facility where final vehicle assembly will occur. Oshkosh did not disclose which of its plants would build the NGDV  or how Ford would be involved.

The Postal Service fleet has more than 230,000 vehicles in every class from purpose-built to commercial vehicles. Approximately 190,000 deliver mail reaching every U.S. community. Many of the vehicles, built by Grumman Corp. (NYSE: NOC), have been in service for 30 years. The Oshkosh contract is open-ended. That means the Postal Service can add money for more vehicles.

The first NGDVs are estimated to appear on carrier routes in 2023.

Air conditioning and heating, improved ergonomics, and advanced vehicle technology, including 360-degree cameras, will be included on the new vehicles. Advanced braking and traction control, air bags, and a front- and rear-collision avoidance system that includes visual, audio warning and automatic braking are also planned.

The vehicles will also have increased cargo capacity to better accommodate higher package volumes stemming from the growth of e-commerce.

Workhorse support

Workhorse was seen as a strong candidate when President Donald Trump was in office. He advocated for Lordstown Motors Corp. (NASDAQ: RIDE), a startup electric pickup truck maker, which purchased the former General Motors Co. (NYSE: GM) assembly complex in northeast Ohio.

Founded by former Workhorse CEO Steve Burns, LMC was expected to manufacture the postal vehicles under contract from Workhorse in the sprawling 6.2 million-square-foot plant. LMC shares fell 13.41% to close at $19.69.

The technology for the Lordstown Endurance Class 1 electric pickup is based on technology leased from Workhorse. The same underpinnings were used for Workhorse’s postal vehicle entry.

Workhorse did not respond to a FreightWaves request for comment on the awarding of the postal contract.

Workhorse production woes

Burns founded  Amp Electric in 2007. It changed its name to Workhorse in 2015 after acquiring a former Navistar International Corp. (NYSE: NAV) plant in Union City, Indiana. After building a few hundred battery-electric vans there, Workhorse pivoted to a composite body battery-electric van called the C-Series. 

The production startup was delayed several times. And Workhorse has been hit with COVID infection and parts supply issues. Only a handful of vans have been built. It has orders for several thousand on its books.

Related articles:

Workhorse scrutinized as Postal Service again delays contract

Analysts’ patience wearing thin with Workhorse delays

GM sells shuttered Lordstown plant to Workhorse founder

Click for more FreightWaves articles by Alan Adler.