House legislature urges Biden’s administration to investigate USPS deal with Oshkosh

United States Postmaster General Louis DeJoy speaks during a House Oversight and Reform Committee hearing on legislative proposals to put the Postal Service on a sustainable financial footing on Capitol Hill in Washington, DC on February 24, 2021.

Jim Watson | AFP | Getty Images

The House Democrats on Tuesday called on the Biden administration to suspend the U.S. Postal Service’s $ 482 million contract with Oshkosh Defense to modernize the service’s aging fleet of vans until investigation shows the award does not Has “inappropriate political influence”.

Three Democratic House legislators – Ohio Reps Marcy Kaptur and Tim Ryan and California Rep Jared Huffman – have tabled a resolution to hold the treaty pending investigation. Kaptur said in a statement that the investigation would also determine whether the contract “is compatible with the president’s executive order on the electrification of the federal fleet”.

The USPS announced on February 23 that it had awarded the first part of its 10-year multi-billion dollar contract to Oshkosh Defense to upgrade its fleet of mail delivery vehicles. Shares in Workhorse Group, an Ohio-based electric vehicle company that vied for the contract, fell nearly 50% the next day and have barely recovered since then. The stock rose nearly 8% on Tuesday and was trading at around $ 16.70 in the afternoon.

Under the contract, Oshkosh would manufacture up to 165,000 postal vehicles over the next ten years, which, according to the announcement, corresponds to around a third of the federal government’s fleet. USPS chief Louis DeJoy recently told lawmakers that only 10% of the new fleet would be electric, “which would be contrary to President Joe Biden’s efforts to electrify the entire federal fleet,” according to lawmakers.

According to the statement, lawmakers are also concerned about reports of “suspicious” stock deals just hours before USPS chief Louis DeJoy announced the deal.

“Ten percent makes no sense and contradicts President Biden’s recent order to electrify the federal fleet,” said Kaptur, chairman of the home remedies subcommittee on energy and water development and co-chair of the House Auto Caucus.

Oshkosh’s shares were relatively unchanged on Tuesday afternoon.

– CNBC’s Pippa Stevens contributed to this report.

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