The knife has continued to fall since that article. In late February, Mark Hake described WKHS stock as a “falling knife”. If it wants the federal government fleet to go electric, there has to be an infrastructure to support that. So while I imagine the Biden administration may not be happy that the only company that proposed an all-electric solution was not awarded the bid, it may cause the administration to recalibrate its plan. There would be no way that an agency as financially strapped as the USPS would have such an infrastructure in place. Companies such as UPS (NYSE: UPS) have already invested millions of dollars into supporting an electric fleet.
The USPS decision highlights the fact that for companies to begin accepting electric vehicles they have to have a charging infrastructure in place. Nevertheless, that is what many assumed since the decision caught many analysts flat-footed. Specifically, did the bidding process specify that USPS couldn’t source internal combustion vehicles? Since Workhorse was the only company with an all-electric proposal, that seems unlikely. Workhorse’s appeal to the USPS is likely to hinge on the details of the bidding process itself. The parameters of the bidding process were likely established long before that. However, DeJoy just assumed the reins in June. That would make sense since Ryan represents the district where Workhorse is located. Ohio Congressman Tim Ryan is calling into question the judgment of United States Postmaster General Louis DeJoy. This would go against President Joe Biden’s administration’s initiative to electrify the federal government fleet. Second, at least initially, Oshkosh will provide traditional internal combustion vehicles. That wouldn’t be the preferred outcome, but it would be better than nothing. First, there was always speculation that the contract might be awarded to multiple vendors. However, Workhorse seems to have two potential lifelines. There’s little chance that the USPS will reverse its decision to give the contract to Oshkosh (NYSE: OSK). Workhorse has approached the USPS to ask for an explanation of their decision. It wasn’t that all of Workhorse’s eggs were in that basket just the ones that were most ready to hatch. Workhorse has yet to scale its operations, but a contract to produce approximately 160,000 trucks for the USPS would ease investors’ concerns. USPS Louis Dejoy's recent update: "We will continue to look for opportunities to increase the electrification of our delivery fleet in a responsible manner, consistent with our operating strategy, the deployment of appropriate infrastructure, and our financial condition, which we expect to continue to improve as we pursue our plan.The narrative is simple. Shares of Workhorse Group ( NASDAQ: WKHS) are now at the highest level of 2022 with the USPS decision last week to double its order of next-gen trucks to just over 10,000 still attracting investor attention. A drop in oil price is also adding to the positive turn in sentiment in the auto sector. That includes ditching its NATO aspirations, refraining from developing nuclear weapons and hosting foreign military bases.
Russia is no longer asking that Ukraine be "denazified" and is prepared to let the nation join the EU if it remains militarily non-aligned. Workhorse Group (WKHS +8.6%) shot up on Tuesday amid a strong day for the automobile sector overall.Īutomobile stocks broke higher with incremental progress in the Ukraine-Russia talks being reported.
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