Workhorse abruptly drops lawsuit against Postal Service over new mail truck

EV startup Workhorse has abandoned its lawsuit protesting the United States Postal Service’s decision to let Oshkosh Defense build the next-generation mail truck. The court accepted Workhorse’s voluntary dismissal late Tuesday — just one day before the first oral arguments were scheduled to begin regarding the USPS’s attempt to dismiss the case.

Workhorse filed the protest in the US Court of Federal Claims in mid-June, nearly four months after the USPS announced that it had awarded the contract to build the next-generation mail truck to defense contractor Oshkosh, ending a contest that started in 2015.

“We are pleased to learn that Workhorse Group has withdrawn its bid protest of the award of the United States Postal Service Next Generation Delivery Vehicle (“USPS NGDV”) contract to Oshkosh Defense,” a spokesperson for Oshkosh said in an email to The Verge.[W]e are proud that the USPS selected our solution to fulfill the needs of the NGDV program. We look forward to working with our partners across the country to get these highly capable and efficient vehicles to the carriers who need them.”

In a statement, the USPS said it “remain[s] committed to modernizing our delivery fleet in service to our customers. The Postal Service is working diligently with our supplier, and looks forward to the production of our Next Generation Delivery Vehicles (NGDV).”

Workhorse’s decision to drop the suit comes just two weeks after a short-selling research firm published a report on the startup, alleging fraud and accusing the company of hiding a Securities and Exchange Commission investigation from investors. Workhorse did not respond to multiple requests for comment about the dismissal and has not answered any questions about the accusations.

The dismissal also comes after Workhorse replaced its CEO and the company announced plans to redesign its flagship electric delivery van, which it had only just started making.

The USPS set out to replace its current mail trucks in 2015, hoping to make the fleet more fuel efficient and give mail carriers modern amenities like advanced safety features and air conditioning. Workhorse was one of the few companies that stuck it out to the final bids last year, and it claimed to be the only one proposing to build an entirely electric mail fleet.

But the Ohio-based company struggled as the contest dragged on, despite having some big-name companies like UPS and FedEx test some of its earlier vehicles. To keep itself afloat, Workhorse borrowed money from hedge funds and sold off parts of its business — including licensing the intellectual property for an electric pickup truck it never built to a new company started by its former CEO, Lordstown Motors.

The Postal Service selected Oshkosh in February, and the agency and the defense contractor revealed a new vehicle that is supposedly able to run on both gas and electric drivetrains. Oshkosh has agreed to make 50,000 to 165,000 of the trucks over 10 years. Only around 10 percent will be electric at the outset, and the ones that aren’t are supposed to be “fuel-efficient [and] low-emission,” though neither Oshkosh nor the USPS has backed up those terms with any numbers. The USPS has said it would need billions more dollars in funding to increase the number of all-electric vehicles it orders from Oshkosh.

Workhorse initially lodged an appeal with the USPS after the award was announced and then filed its bid protest in Federal Claims Court on June 16th. The USPS (and Oshkosh, which joined the case to support the agency’s defense) argued Workhorse was supposed to go through at least one more official step as laid out in the contest rules before it filed a federal lawsuit and tried to have the case dismissed on these grounds. Oral arguments on the USPS’s motion to dismiss were scheduled for Wednesday.

The USPS has been highly secretive about the particulars of the contest and its decision to go with Oshkosh. Workhorse has alleged that Oshkosh changed its plans at the end of the contest, and that the design revealed in February was never subject to the tests that the USPS required by its own rules. Workhorse also revealed in one of its own filings that the USPS told the startup there was at least one other all-electric entrant, and that even if the agency hadn’t selected Oshkosh, Workhorse still wouldn’t have won the contract.

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