WASHINGTON — The U.S. Postal Service (USPS) mentioned on Tuesday it should award a multibillion-dollar, 10-year contract to Oshkosh Protection to fabricate a brand new era of postal supply autos.

Underneath the preliminary $482 million funding, Oshkosh Protection, a unit of Oshkosh Corp, will finalize the manufacturing design, testing and automobile tooling vital previous to automobile manufacturing.

The contract, which may very well be value greater than $6 billion in complete, permits for supply of between 50,000 to 165,000 of the autos over 10 years that will likely be a mixture of inside combustion-powered and battery-electric autos. Oshkosh had teamed up with Ford Motor Co. on its proposal primarily based on a Transit van.

The present gas-guzzling USPS supply autos are almost 30 years outdated on common. An audit report final yr mentioned USPS spent $5,000 alone per supply automobile yearly on upkeep prices.

Oshkosh shares rose about 6.1% on the information.

Shares of Workhorse Group, a dropping bidder that sought to construct electrical solely autos on the former GM plant in Lordstown, Ohio, had been briefly halted and misplaced nearly half their worth after the information.

Colliers Securities analyst Michael Shlisky mentioned Workhorse’s lack of the contract is “actually dangerous information for current Workhorse traders.”

USPS, which started planning to interchange the present fleet in 2015, mentioned the brand new autos may very well be retrofitted later with “electrical automobile applied sciences.”

The USPS fleet has greater than 230,000 autos, together with 190,000 that ship mail.

New USPS autos will start deliveries in late 2023 and embody air-con and heating, improved ergonomics, and superior automobile security know-how together with air baggage and 360-degree cameras. They’ll be capable of carry extra cargo and higher accommodate larger package deal volumes.

Final month, President Joe Biden vowed to interchange the U.S. authorities’s fleet of roughly 650,000 autos with electrical fashions. The White Home didn’t reply to a request for touch upon the USPS contract choice.