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Workhorse Slammed After Missing Out on Postal Truck Contract

Electric vehicle maker’s stock cut in half on postal service decision to award new delivery truck contract to rival.
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Shares of Workhorse Group  (WKHS) - Get Workhorse Group Inc. Report fell sharply Tuesday after the postal service awarded a potentially huge contract to build new delivery trucks to rival Oshkosh  (OSK) - Get Oshkosh Corporation (Holding Company)Common Stock Report.

Workhorse shares fell $14.88, or 47%, to $16.47 in the regular session. It continued to fall in after-hours action.

Oshkosh gained $6.34, or 6.1%, to $109.62 in the regular session and rose sharply in after-hours action.

“Under the contract's initial $482 million investment, Oshkosh Defense will finalize the production design of the Next Generation Delivery Vehicle (NGDV) — a purpose-built, right-hand-drive vehicle for mail and package delivery — and will assemble 50,000 to 165,000 of them over 10 years,” the postal service said in a statement.”

The ultimate value of the contract could reach $6 billion by some estimates. The postal service has more than 230,000 vehicles including about 190,000 used to deliver mail, according to the statement.

President Joe Biden gave electric vehicle makers a boost earlier this month by vowing to electrify the entire Federal vehicle fleet to reduce carbon emissions and combat climate change.

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The new postal trucks will not necessarily be electric, according to the release. “The vehicles will be equipped with either fuel-efficient internal combustion engines or battery electric powertrains and can be retrofitted to keep pace with advances in electric vehicle technologies.”

The first of the new vehicles are expected to appear on the road in 2023. 

Elsewhere, electric vehicle stocks fell broadly on a volatile day for Wall Street. 

Tesla  (TSLA) - Get Tesla Inc. Report shares fell $15.66, or 2.2% to $698.84 just above the $695 price where it entered the S&P 500 two months ago. The stock traded as high as $900 in late January. 

Lordstown Motors  (RIDE) - Get Lordstown Motors Corp. Report fell $3.05, or 13% to $6.78.  The company is targeting the commercial fleet market with light-duty trucks. 

Also on Tuesday, privately-held Lucid Motors said it had agreed to go public via a SPAC deal with Churchill Capital IV, CCIV  with trading expected to begin by late in the second quarter. Shares of the special acquisition company fell $22.16, or 39%, to $35.21 Tuesday.