USPS EV Contract: Time to Rethink the $10B Deal?

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Aug 20, 2025

The $10B USPS EV deal promised 35,000 trucks but delivered only 250. Is it time to scrap it for a cheaper, faster gas-powered option? Read on to find out...

Financial market analysis from 20/08/2025. Market conditions may have changed since publication.

Have you ever waited for a package, tracking it obsessively, only to find out it’s stuck somewhere in transit? Now imagine that frustration on a national scale, with billions of dollars at stake. The U.S. Postal Service (USPS) is in the middle of a high-stakes gamble to modernize its aging fleet with electric vehicles (EVs), but the results so far are, frankly, a bit of a letdown. A $10 billion contract, awarded with much fanfare, promised a shiny new fleet of 35,000 electric trucks. Yet, over two years later, only 250 have rolled out. That’s right—250. It’s enough to make you wonder: is this deal delivering on its promise, or is it time to pull the plug?

The Big Bet on Electric Postal Trucks

The push for an electrified USPS fleet sounded like a dream come true. Clean, green, and modern, the plan was to replace the creaky, gas-guzzling trucks from the 1980s with sleek, battery-powered vehicles. The contract, valued at nearly $10 billion, was handed to a company with big promises but little experience in delivery vehicles. The goal? Produce 35,000 electric trucks, with 3,000 ready by late 2024. Fast forward to today, and the numbers tell a different story: only a fraction of that goal has been met, leaving taxpayers and postal workers in the lurch.

The plan was ambitious, but execution has been a struggle from the start.

– Industry analyst

So, what went wrong? For starters, the company tasked with building these trucks admitted to a critical flaw: they didn’t fully know how to make them. That’s a tough pill to swallow when billions of dollars are on the line. Early deliveries required significant fixes, driving up costs and delaying rollouts. It’s the kind of misstep that makes you question whether the right company was chosen for such a massive undertaking.

A Costly Misstep or a Learning Curve?

Let’s break it down. The contract, awarded in 2022, was meant to deliver 50,000 Next Generation Delivery Vehicles (NGDVs), with a significant portion being electric. The price tag? A cool $2.98 billion to start, with billions more in subsidies to build a new production facility. Yet, the results have been underwhelming. The few trucks delivered needed tweaks before they could hit the road, and the promised timeline for thousands of vehicles has slipped further out of reach.

  • Initial Promise: 3,000 EVs by late 2024.
  • Reality Check: Only 250 trucks delivered so far.
  • Cost Overruns: Higher prices agreed upon despite delays.

It’s not just about the numbers, though. The ripple effects are real. Postal workers are stuck with aging trucks that break down frequently, slowing down mail delivery. Taxpayers are footing the bill for a project that’s not delivering. And the push for sustainability, while noble, seems to have taken a backseat to practical realities. Perhaps the most frustrating part? The company behind the deal didn’t even have a working prototype when they won the contract. That’s like hiring a chef who’s never cooked a meal.

A Gas-Powered Alternative Steps Up

Enter a new player: a veteran-owned manufacturer ready to shake things up. Unlike the EV contractor, this company has developed a gas-powered delivery truck—called the Kestrel—without relying on hefty government subsidies. Their pitch? Deliver 100,000 vehicles by 2029 for $5.5 billion, nearly half the cost of the EV program. That’s a bold claim, and it’s caught the attention of lawmakers and industry watchers alike.

We can build reliable, American-made trucks faster and cheaper.

– Manufacturing executive

The Kestrel is already in field testing, with five units being put through their paces by the USPS. Early feedback suggests it’s a practical, no-nonsense solution that could get the postal service back on track. The company behind it operates out of a massive facility in Virginia, ready to ramp up production as soon as they get the green light. And here’s the kicker: their trucks are right-hand-drive, gas-powered, and designed specifically for the postal service’s needs—no fancy bells and whistles, just results.

Why the EV Dream Is Stalling

Electric vehicles are the future, right? Well, maybe not for every job. The USPS’s EV push was driven by a mix of environmental goals and political momentum, but the reality of electrifying a massive fleet is more complicated. For one, EVs are expensive to produce, especially when you’re starting from scratch. Charging infrastructure is another hurdle—most postal facilities aren’t equipped to handle thousands of electric trucks. And then there’s the issue of range. Delivery routes in rural areas can stretch for hours, and EVs still struggle to match the reliability of gas-powered vehicles in those conditions.

Fleet TypeCost EstimateDelivery TimelineKey Challenge
Electric (EV)$10 billion3,000 by 2024 (missed)Production delays
Gas (Kestrel)$5.5 billion100,000 by 2029Scaling production

I’ve always been a fan of sustainable tech, but there’s something to be said for getting the job done. EVs sound great on paper, but when you’re delivering mail to every corner of the country, reliability and cost matter just as much as emissions. The Kestrel, with its lower price tag and faster timeline, feels like a pragmatic choice in a world where idealism often outpaces reality.

Policy Shifts and New Priorities

The debate over the USPS fleet comes at a time when federal priorities are shifting. A recent executive order has loosened rules around fleet electrification, emphasizing cost efficiency and practicality over rigid environmental mandates. This change has opened the door for alternatives like the Kestrel, which aligns with a broader push to rethink “ideologically driven” regulations. It’s a subtle but significant shift, signaling that results might take precedence over optics in the years ahead.

Some lawmakers are already calling for the EV contract to be scrapped. One senator labeled it one of the most wasteful federal projects, pointing to the billions spent for minimal results. The argument is simple: why keep pouring money into a program that’s failing to deliver when a cheaper, faster alternative is ready to go? It’s a question that resonates with anyone who’s ever balanced a budget or waited for a late delivery.

What’s Next for the USPS?

The USPS is at a crossroads. Stick with the EV dream and hope the kinks get worked out, or pivot to a gas-powered solution that promises quicker results at a lower cost. The decision isn’t just about trucks—it’s about the future of mail delivery, taxpayer dollars, and the balance between sustainability and practicality. With field tests of the Kestrel underway and a potential launch event planned for early 2026, the postal service is clearly keeping its options open.

  1. Evaluate Current Progress: Assess the EV contract’s performance and costs.
  2. Test Alternatives: Expand trials of gas-powered options like the Kestrel.
  3. Prioritize Efficiency: Focus on solutions that deliver results for taxpayers and postal workers.

In my experience, big projects like this often start with bold visions but stumble on the details. The USPS needs a fleet that works—plain and simple. Whether that’s electric, gas, or a mix of both, the focus should be on getting mail to doorsteps without breaking the bank. The Kestrel might just be the practical solution we’ve been waiting for, but only time will tell.


So, what’s the takeaway? The USPS’s EV experiment hasn’t lived up to the hype, and a gas-powered alternative is gaining traction. With billions of dollars and the future of mail delivery at stake, it’s time to ask some hard questions. Should we keep betting on a struggling EV program, or is it time to shift gears? The answer might just redefine how we think about modernizing America’s postal service.

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