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Home Legislature urges Biden's administration to analyze USPS treaty with Oshkosh Protection

United States Postmaster General Louis DeJoy speaks during a House Oversight and Reform Committee hearing on legislative proposals to put the postal service on a sustainable financial footing on Capitol Hill in Washington, DC on February 24, 2021.

Jim Watson | AFP | Getty Images

The House Democrats called on the Biden government Tuesday to suspend the U.S. Postal Service's $ 482 million contract with Oshkosh Defense to modernize the service's aging fleet of delivery vans until investigation shows the award does not have any Has "inappropriate political influence".

Democratic Representatives Marcy Kaptur and Tim Ryan from Ohio and Jared Huffman from California have passed a resolution that will withhold the treaty pending an investigation. Kaptur said in a statement that the investigation would also determine whether the contract "is compatible with the president's executive order on the electrification of the federal fleet".

The USPS announced on Feb.23 that it had awarded Oshkosh Defense the first part of its 10-year multi-billion dollar contract to upgrade its fleet of mail delivery vehicles. Shares in Workhorse Group, an Ohio-based electric vehicle company that vied for the contract, fell nearly 50% the next day and have barely recovered since then. The stock rose nearly 8% on Tuesday to close at $ 16.35.

Under the contract, Oshkosh would manufacture up to 165,000 postal vehicles over the next ten years, which is roughly a third of the federal government's fleet, according to the announcement. USPS chief Louis DeJoy recently told lawmakers that only 10% of the new fleet would be electric, "which would be contrary to President Joe Biden's efforts to electrify the entire federal fleet," according to lawmakers.

According to the statement, lawmakers are also concerned about reports of "suspicious" stock deals just hours before DeJoy announced the deal.

"Ten percent makes no sense and contradicts President Biden's recent order to electrify the federal fleet," said Kaptur, chairman of the House Appropriations subcommittee on energy and water development and co-chair of the House Auto Caucus.

The shares of Oshkosh Corporation, the parent company of Oshkosh Defense, closed slightly on Tuesday.

– CNBC's Pippa Stevens contributed to this report.

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