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Home Business Oshkosh Defense to build U.S. Postal vehicles; Workhorse shares slide By Reuters

Oshkosh Defense to build U.S. Postal vehicles; Workhorse shares slide By Reuters

© Reuters. An Oshkosh truck utilizing the TerraMax autonomous driving system drives alongside a mud-soaked check course exterior of Pittsburgh

By David Shepardson

WASHINGTON (Reuters) – The U.S. Postal Service (USPS) mentioned on Tuesday it’s going to award a multibillion-dollar, 10-year contract to Oshkosh (NYSE:) Defense to manufacture a brand new technology of postal supply autos.

Under the preliminary $482 million funding, Oshkosh Defense, a unit of Oshkosh Corp, will finalize the manufacturing design, testing and automobile tooling obligatory prior to automobile manufacturing.

The contract, which could possibly be price greater than $6 billion in complete, permits for supply of between 50,000 to 165,000 of the autos over 10 years that will probably be a mixture of inside combustion-powered and battery-electric autos. Oshkosh had teamed up with Ford Motor (NYSE:) Co on its proposal primarily based on a Transit van.

The present gas-guzzling USPS supply autos are almost 30 years previous on common. An audit report final 12 months mentioned USPS spent $5,000 alone per supply automobile yearly on upkeep prices.

Oshkosh shares rose about 6.1% on the news. Shares of Workhorse Group Inc, a shedding bidder that sought to build electrical solely autos, had been briefly halted and misplaced virtually half their worth after the news.

Colliers Securities analyst Michael Shlisky mentioned Workhorse’s lack of the contract is “really bad news for recent Workhorse investors.”

USPS, which started planning to exchange the present fleet in 2015, mentioned the brand new autos could possibly be retrofitted later with “electric vehicle technologies.”

The USPS fleet has greater than 230,000 autos, together with 190,000 that ship mail.

New USPS autos will start deliveries in late 2023 and embody air-con and heating, improved ergonomics, and superior automobile security know-how together with air baggage and 360-degree cameras. They will probably be ready to carry extra cargo and higher accommodate increased package deal volumes.

Last month, President Joe Biden vowed to exchange the U.S. authorities’s fleet of roughly 650,000 autos with electrical fashions. The White House didn’t reply to a request for touch upon the USPS contract resolution.

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