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Company That Wasn't Picked To Make Mail Trucks Is Suing The U.S. Postal Service

This prototype of a new USPS mail delivery truck was unveiled in February as part of an announcement that the Postal Service was overhauling its fleet to include more electric vehicles.
This prototype of a new USPS mail delivery truck was unveiled in February as part of an announcement that the Postal Service was overhauling its fleet to include more electric vehicles.

Updated July 13, 2021 at 8:18 AM ET

An electric vehicle manufacturer is suing the U.S. Postal Service for what it alleges was bias in picking a company to make its latest fleet of delivery trucks.

Congressional Democrats are skeptical of the contract, too. Though USPS has cast the new vehicles as a "major step forward" toward a greener future, some Democrats are saying the plan doesn't go far enough.

The contract

Postmaster General Louis DeJoy announced plans to finally replace the U.S. Postal Service's fleet of gas guzzling, unairconditioned and fire-prone delivery trucks in February with great fanfare.

DeJoy said the builder of the new delivery vehicles would be Oshkosh, a defense contractor with experience manufacturing armored trucks for the military, but less experience building delivery vehicles.

According to a lawsuit filed by electric vehicle maker Workhorse, which lost the contract — worth as much as $3.1 billion — Oshkosh has never made a electric delivery vehicle.

That's just one of the charges Workhorse has made in its legal protest of the Postal Service's decision to go with Oshkosh.

The allegations

Workhorse is asking the U.S. Court of Federal Claims to overturn the contract and to issue an injunction to stop it from taking effect.

The company, which would not comment on the suit citing a nondisclosure agreement with the USPS, charges that the Postal Service "put its thumb on the scale" against Workhorse.

The suit alleges that the company was unfairly penalized by the Postal Service because one of its prototypes rolled out of control during testing, something the company says was the Postal Service driver's fault for not putting the truck in park.

Jack Horan, an attorney who practices government procurement law at Faegre Drinker Biddle & Reath and teaches at Georgetown University Law, says it might be hard for the company to prove such a bias.

"For those type of allegations," he tells NPR, "it's an especially high hurdle, because the courts presume that government officials are acting in good faith and require a significant amount of proof to establish bad faith or bias."

Horan says the agency's quasi-independent status also means it's governed by a different set of rules. "It's not covered by the usual procurement regulations that apply to federal agencies. So as a result of that, the Postal Service has more discretion, business discretion and leeway in handling its procurement than other government agencies."

For its part, the Postal Service says it does not comment on active litigation, but that it is "looking forward to the start of vehicle production" and that "preproduction design, tooling, and facility preparation activities are proceeding on schedule," with the first of the vehicles "estimated to appear on carrier routes in 2023."

Steven Schooner, a law professor at George Washington University Law School, says the complaint "paints a compelling and, frankly, disturbing picture" and that while companies like Workhorse that appeal contract losses face an uphill battle, "that doesn't mean they never prevail."

Concern in Congress

The Oshkosh contract is also being challenged in Congress.

Rep. Marcy Kaptur (D-Ohio) wants the Biden administration to review the contract with the company. "My concern is that they don't lead America into the future."

The Postal Service has said that 90% of the new Oshkosh delivery vehicles would be gasoline-powered, and only 10% would be electric vehicles, unless Congress provides it with the money to buy more EVs. Kaptur says that's moving in the wrong direction.

"When you're going to be buying that level of vehicle, over 165,000 vehicles and only 10% of them are green," she says, "that doesn't really make sense to me. And it's very backward-looking."

Kaptur and two other Ohio Democrats have written to President Biden, asking him to take a look at the Oshkosh contract. Workhorse would likely build its vehicles in Ohio.

Oshkosh says it can't comment on the suit, but that it looks forward to "getting these highly capable vehicles into the hands of mail carriers." It says it can deliver "any mix of gas powered or electric vehicles the postal service orders."

The company also announced it intends to build them at a new plant in Spartanburg, S.C.

Copyright 2021 NPR. To see more, visit https://www.npr.org.

NPR News' Brian Naylor is a correspondent on the Washington Desk. In this role, he covers politics and federal agencies.