Workhorse Group (WKHS) lost the race for a key contract with the U.S. Postal Service to a unit of Oshkosh (OSK), which reportedly partnered with Ford (F) on the bid.
The USPS awarded Oshkosh Defense a deal to deliver 50,000-165,000 battery-electric and low-emission combustion-engine vehicles over 10 years, according to a Tuesday news release, which described it as the Postal Service's "first large-scale fleet procurement in three decades."
The postal agency will pay Oshkosh $482 million for initial engineering and factory buildout ahead of production of the "next-gen" delivery vehicles. The contract is estimated to be worth more than $6 billion.
Production is expected to begin in 2023, the release said.
Investors in Workhorse, a small electric van company out of Ohio, had pinned their hopes on the postal contract. Many saw the contract as a home run that would put Workhorse on the path to profitability.