Workhorse starts federal court fight over lost USPS contract

Image: USPS

EV startup Workhorse has filed an official protest after losing the bid to make the United States Postal Service’s next-generation mail vehicle in February, a contract that could ultimately be worth some $6 billion. The USPS instead gave that contract to defense contractor Oshkosh.

The Ohio-based company filed a bid protest in the US Court of Federal Claims on Wednesday. The complaint is currently sealed, though a judge could ultimately rule to make some parts of it public, as Workhorse also filed a redacted version of the complaint that could be made public.

The bid protest kicks off a high-profile court fight over the contract for the next-generation mail truck, and could have an impact on how and when those vehicles switch over to electric power — something President Biden has said he wants across the federal fleet.

“While we do 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),” Kim Frum, senior public relations representative for the USPS said in an email to The Verge. “Preproduction design, tooling, and facility preparation activities are proceeding on schedule with the first NGDVs estimated to appear on carrier routes in 2023.”

“While bid protests are a normal part of the government contracting process, we do not comment on such proceedings,” Alexandra C. Hittle, Oshkosh Defense’s director of global marketing and communications, said in an email to The Verge. “We are proud that the USPS selected Oshkosh Defense to fulfill the needs of the NGDV program and we look forward to getting these highly capable vehicles into the hands of mail carriers.”

Workhorse was one of three companies that submitted final bids to the USPS last year, and was the only one proposing to build an entirely electric mail fleet. The Postal Service and Oshkosh revealed the new vehicle in February, and said that it is designed to run on both gas and electric drivetrains. The defense contractor has said the gas vehicles will be “fuel-efficient [and] low-emission” but has not qualified those claims. Oshkosh agreed to build between 50,000 to 165,000 of the trucks over 10 years, but the USPS says it needs billions more in funding from Congress in order to tip the balance of the fleet more towards electric.

In requesting that the complaint be sealed, Workhorse told the court that the document “contains confidential and proprietary source selection and proposal information” about its bid, and that future filings will or are likely to contain similar information about competitors’ bids.

But of the options that were on Workhorse’s table, this one may prove the most effective at helping the company’s legal team understand why the USPS went with Oshkosh. “They will get to see everything, the whole file, how [the bids were] evaluated, the award memo,” a person familiar with the Postal Service’s contracting process told The Verge earlier this year. That process will likely take place under a protective order, though, so Workhorse’s lawyers may ultimately only be able to tell the company whether or not they have a good chance at winning.

Oshkosh has said it is still finalizing the design of the new vehicle, and that they won’t hit the road until 2023. The USPS agreed to invest $482 million up front to help ready the new vehicle. Oshkosh had worked with Ford during the bidding process, but the automaker has repeatedly declined to comment on whether it was involved in the defense contractor’s final pitch, which looks much different from spy shots of earlier prototypes based off the Transit van.

The USPS set out to replace the current mail truck in 2015 with a plan to put the new vehicles on the road by 2018. It originally selected six companies (or teams of companies) to work up prototypes. But the bid process dragged on for years. A 2020 report from the Office of the Inspector General (OIG) detailed why: a lot of the prototypes were awful and broke down.

Replacing the current mail trucks has only become more of a pressing issue, though. Built by defense contractor Grumman, many of the so-called Long Life Vehicles have blown past their life expectancies. That has left them either breaking down, which is costing the USPS a fortune, or in some cases catching on fire. Even the Long Life Vehicles that are able to stay on the road lack modern amenities like advanced safety features and even air conditioning.

Beyond the OIG report, there has been little insight into the USPS’s decision to go with Oshkosh. The bid process was incredibly opaque, to the point that Rep. Tim Ryan (D-OH) called it a “black box” in an interview with The Verge earlier this year.

Workhorse itself has said very little since it lost the bid in February, but the USPS apparently still took issue with some of the company’s communications. In the request to seal the complaint filed Wednesday, Workhorse says the USPS believes the company breached its NDA.

Developing…

Author: Sean O’Kane

Source: Sean O’Kane.” Workhorse starts federal court fight over lost USPS contract”. Retrieved From https://www.theverge.com/2021/6/16/22536793/workhorse-federal-bid-protest-usps-contract-oshkosh-ngdv

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