The United States Postal Service has awarded Oshkosh Defense a massive contract to help “modernize” its vehicle delivery fleet. The multibillion-dollar contract was awarded to the Wisconsin-based company and will “help the agency reduce its costs and transition away from greenhouse gas-emitting technologies to cleaner solutions.”
Oshkosh shares initially jumped 10% at the time of the announcement.
The agency said that as part of its initial $482 million investment, Oshkosh Defense will finalize the vehicle design and assemble as many as 165,000 vehicles over the course of a decade.
“The contract is the first part of a multibillion-dollar, 10-year effort to replace the Postal Service’s delivery vehicle fleet, one of the world’s largest,” USPS said in a statement, noting that it has more than 230,000 vehicles in every class.
The award is an indefinite delivery, which means the Postal Service will be able to order more vehicles beyond the initial investment. Overall, the contract is expected to be of multibillion-dollar value.
The next-gen delivery vehicles are expected to appear on the road in 2023. They will include air conditioning, heating, 360-degree cameras, advanced braking and traction control, air bags, collision avoidance systems, as well as increased cargo room to evolve alongside a growing ecommerce business.
Fox Business reports.