WORKHORSE USPS CONTRACT DRIVER
WORKHORSE USPS CONTRACT SERIES

While bid protests are a normal part of the government contracting process, we do not comment on such proceedings,вЂќ the company said in a statement. Postal ServiceвЂ™s award of the Next Generation Delivery Vehicle contract to Oshkosh. вЂњOshkosh Defense is aware that Workhorse Group has filed a bid protest with respect to the U.S. Oshkosh said it will continue to move forward with its contract despite the Workhorse complaint.

WORKHORSE USPS CONTRACT DRIVER

вЂњRather than acknowledge the clear driver errors, the USPS not only disingenuously directed the blame at Workhorse but has seized upon this incident as its вЂposterchildвЂ™ reason it could not have awarded the contract to Workhorse,вЂќ the company said. The unattended vehicle then rolled down a slope into the ditch. The driver then left the driverвЂ™s seat and walked to the cargo area. The company said the USPS test track driver failed to put the prototype in park, leaving it shifted to the drive position. вЂњThe USPS misleadingly claims that a flaw in WorkhorseвЂ™s parking brake system caused WorkhorseвЂ™s prototype vehicle to roll down an incline and into a ditch, injuring a test track driver,вЂќ Workhorse said. Workhorse said the Postal Service unfairly blamed its truck for a mishap that injured a worker evaluating the prototype. This was especially puzzling given that Oshkosh has never previously produced a last-mile delivery vehicle, much less an electric one,вЂќ according to the complaint. вЂњEven though вЂprototype performanceвЂ™ was specifically identified as an evaluation subfactor, the USPS had selected a vehicle from Oshkosh that skipped the prototype phase altogether. In its complaint, Workhorse said the rendering of the Oshkosh mail truck depicts a vehicle that is entirely different than what the company had provided for testing during the competition.

That percentage would allow the agency to test the technology and limit the cost of installing chargers at postal facilities. Although the Postal Service has considered using electric vehicles for its new fleet, just 10 percent of the vehicles in the Oshkosh contract would be electric, Postmaster General Louis DeJoy said at a Congressional hearing earlier this year. WorkhorseвЂ™s proposal would have provided a fleet of electric vehicles. They are also prone to fires, with several hundred burning up in recent years. A 2014 audit from the USPS inspectorвЂ™s office found that the current fleet could only meet the agencyвЂ™s delivery needs through the 2017 fiscal year. Manufactured from 1987 through 1994, they need to be replaced. The post office wants to replace a fleet of about 140,000 Grumman Long Life Vehicles that it uses for its main delivery service.

WORKHORSE USPS CONTRACT SERIES

as a major supplier in the program, will assemble the new mail truck at a dedicated factory in Spartanburg, S.C.ДЄ series of contracts are expected to approach $6 billion.

It engaged in discussions with Workhorse that improperly failed to meaningfully notify Workhorse of perceived deficiencies in its proposal and that misled Workhorse as to the areas Workhorse needed to address in its updated proposal,вЂќ the company said in its filing. вЂњIt falsely blamed WorkhorseвЂ™s prototype vehicle for a вЂњsafety incidentвЂќ that was clearly the result of the USPS driverвЂ™s error. The filing said Workhorse spent more than $6 million designing electric prototypes of a replacement mail truck as part of a formal bidding process but that that agency didnвЂ™t take its offering seriously following a mishap with a truck. The agreement also provides Oshkosh funds to pay for tooling and factory configuration needed before launching production. Under the terms of the initial deal, Oshkosh, Wisc.,-based Oshkosh will get a $482 million contract to complete the production design of its mail truck offering.

The weight of evidence today - bolstered by BidenвЂ™s comments - strongly implies that Workhorse will win that USPS contract, and soon.The Postal Service announced Oshkosh Defense as the winner of the competition to build the mail truck in February. When it comes to WKHS stock, itвЂ™s all about the USPS contract. Discounted back by 8% per year, that implies a 2021 price target of over $40. Based on a 20X forward earnings multiple, that implies a 2029 price target for WKHS stock of $80. Operating margins could clock in around 15%.ДЄll in all, these inputs imply $4 in earnings per share potential by 2030. Increased scale should drive positive operating leverage and push the opex rate down to a more normal 10% rate. I think market share will round out to about 20% by the end of the decade.ДЄssuming so, I see WorkhorseвЂ™s revenues charging north of $5 billion in 2030. Workhorse will win the USPS contract, and leverage first moverвЂ™s advantage to turn into one of the biggest players in the domestic market. I think all 350,000 of those vans will be electric by 2030. About 350,000 last-mile delivery vans are sold in the U.S.

Workhorse usps contract