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WASHINGTON (Reuters) – A group of 17 U.S. House Democrats introduced legislation on Monday to award $6 billion to the U.S. Postal Service (USPS) to buy tens of thousands of additional electric delivery vehicles.
Electric-vehicle maker Workhorse Group Inc shares jumped 13% on prospects that the company may be able to sell electric postal vehicles. Last month, the company lost out when USPS awarded a $482 million contact to Oshkosh (NYSE:OSK) Defense to finalize production for the next-generation postal vehicles.
The bill sponsored by Representative Jared Huffman and seen by Reuters would require at least 75% of the new fleet be electric or zero-emission vehicles. If Congress approves funding, there is no guarantee USPS would agree to buy vehicles from Workhorse.
Last month, the USPS said it was committed to having electric vehicles make up 10% of its next-generation fleet as part of its multibillion-dollar plan to retire its 30-year-old delivery vehicles. It said it could boost that percentage if it received billions of dollars in government assistance.
The legislation is backed by some key Democrats, including Representative Peter DeFazio, who chairs the Transportation and Infrastructure Committee, and Representative Carolyn Maloney, who chairs the Oversight and Reform committee that oversees USPS.
The bill would also require no less than 50% of medium/heavy-duty vehicle purchases be electric or zero-emission through 2029 and all new USPS vehicles to be zero-emission after January 2040.
The USPS said last month it had awarded a $482 million contact to Oshkosh, rejecting a proposal from Workhorse Group, which met last week with USPS to question its decision.
USPS said Monday “we welcome and are interested in any support from Congress that advances the goal of a Postal Service vehicle fleet with zero emissions, and the necessary infrastructure required to operate it. With the right level of support, the majority of the Postal Service’s fleet can be electric by the end of the decade.”
Workhorse said it applauds “any efforts that support the Biden administration’s goal of expanding the government’s fleet of clean, non-combustion engine vehicles.”
The contract, which could be worth more than $6 billion in total, allows for delivery of between 50,000 and 165,000 of the vehicles over 10 years.
In January, President Joe Biden vowed to replace the U.S. government’s fleet of roughly 650,000 vehicles with electric models.
Asked what it would take to buy 90% EVs, U.S. Postmaster General Louis DeJoy told lawmakers last month: “We don’t have the 3 or 4 extra billion in our plan right now that it would take to do it.”
