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Workhorse sues Postal Service over delivery truck contract

Company is protesting $482 million, 10-year award to bidding rival Oshkosh

Should Postal Service integrate parcel, mail networks? (Photo: Jim Allen/Freightwaves)

Workhorse Group [NASDAQ: WKHS] has sued the U.S. Postal Service over the government agency’s awarding of a piece of its $6.8 billion delivery truck contract to Oshkosh Corp. [NYSE: OSK], a move Workhorse had been considering since the award was announced in February.

Workhorse’s bid protest was filed under seal in the U.S. Court of Federal Claims on Wednesday, but a public version redacting confidential and proprietary information could be filed in the coming weeks.

Workhorse posted a statement noting it could not comment on the complaint but will “provide updates when appropriate and as permitted” under its non-disclosure agreement with the Postal Service. Brian Schaffer, a Workhorse spokesman, commented, “The federal claims court does try to move quickly within the confines of the judicial system.”

Oshkosh Defense, the subsidiary selected to build the trucks, immediately filed a motion to intervene in the lawsuit, claiming it has a “direct and substantial economic interest” in the outcome. “If Workhorse prevails, Oshkosh, as the awardee, will certainly suffer a nontrivial competitive injury because a reevaluation may affect the award result,” the company stated in its filing.

While the agency does not comment on active litigation, “the United States Postal Service is looking forward to the start of vehicle production for our Next Generation Delivery Vehicle (NGDV),” a Postal Service spokesperson said in a statement. “Preproduction design, tooling and facility preparation activities are proceeding on schedule with the first NGDVs estimated to appear on carrier routes in 2023.”

The first-tranche award to Oshkosh — $482 million over 10 years to produce up to 165,000 NGDVs — did not specify battery-electric vehicles. However, Oshkosh has pushed back on assertions by Workhorse and others that the award means that the Biden administration will fall short of zero-emission goals for its federal fleet.

“We can do 100% electric vehicles from Day One,” insisted Oshkosh President and CEO John Pfeiffer during a recent analysts call. “If the U.S. Postal Service came to us tomorrow and said, ‘We’ve got the funding to do 100% electric from 2023,’ we can do it.”

When asked by reporters about the contract in April, Secretary of Transportation Pete Buttigieg would not commit to reviewing it, asserting, “There are obviously layers of complication around any individual procurement.”

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John Gallagher

Based in Washington, D.C., John specializes in regulation and legislation affecting all sectors of freight transportation. He has covered rail, trucking and maritime issues since 1993 for a variety of publications based in the U.S. and the U.K. John began business reporting in 1993 at Broadcasting & Cable Magazine. He graduated from Florida State University majoring in English and business.