Oshkosh CEO talks electrifying USPS fleet

PSA truck outside your house may look different soon. This week, Oshkosh delivering at the first of its new next generation delivery vehicles for the government agency after or quasi government agency after winning a 2021 contract from the US Postal Service to modernize its fleet. The contract is for up to 165,000 vehicles on a $482 million initial investment. But joining us now in an exclusive interview is Oshkosh Corp CEO John Pfeiffer, who's here on set. It's great to have you. Yeah, Morgan, thank you. And thank John for having me on today. Happy to be here. I mean, I remember a couple of years ago, we were talking about you winning this contract. At the time, it was seen as as as a controversial contract award. It was contested by the other competitor who is no longer in this market in this way. But we talk about electrification of vehicles. We talk so much about it on the consumer side. Yeah, you're in the commercial side, starting with the Postal Service. What are you seeing in terms of the opportunity and impact of that contract, especially as we've seen the Inflation Reduction Reduction Act just continue to propel the demand for these EVs? Yeah, sure. So let me just remind everybody who we are as a company, Oshkosh Corporation, we've been in business a long time and what we do is we design and develop purpose built vehicles and equipment for people in our communities who do the toughest work. Soldiers, firefighters, people that work at great height in many different occupations with our booms and lifts, people on the tarmac of an airport that have to do tough work. And now our newest segment, last mile delivery and and serving the postal carrier and allowing them to be more productive and and safer and more comfortable to execute their missions every day than they've ever been before. OK, So what do you so, so I guess which part of the business is growing the fastest then in terms of demand given those different markets, given the fact that we do see this push towards electrification, we also have all this investing into new infrastructure. Yeah. So first of all, the, the electrification world for the commercial markets I think is very different in terms of demand creation then than commercial auto or I'm sorry, passenger cars. I'll say. And the reason is, is that when we develop an electric vehicle, whether it's for last mile delivery or a 40,000 LB fire truck or a refuse and recycling collection vehicle or the vehicle that operates on the tarmac of an airport or an aerial boom, we do it with the customers value proposition in mind. And we know that we have to deliver them an economic benefit. Sure, everyone likes that it's better performance as an electric product. They like that it's zero emission, but it has to provide economic benefit. And when it provides economic benefit, there's an incentive for commercial operators to adopt it. Speaking of, there was a yellow flag I think on EVs waved with Hertz when they made this big bet on Teslas and EVs and then they got caught by the maintenance costs on the other end. How are you helping customers pencil out what those costs are going to be, how the refueling or recharging is going to work and whether they have the correct infrastructure in the right places to get the economic benefits? Well, John, that's always a pacing item, right? So the US Postal Service is putting electric recharging infrastructure in place and they're doing it faster than anybody else is doing it. So you're going to see our demand and our delivery for electric last mile delivery vehicles, the NGDV for the Postal Service go faster than other markets because they're they're getting themselves ready for an electric future. I think you'll see pretty rapid adoption in the, in the environmental services space, it's refuse and recycling collection because it's a perfect use case for an electric vehicle. And the customers are starting to recognize that they need to build out the infrastructure to be able to adopt these vehicles. One of our biggest customers, Republic, has already said this is the vehicle of the future for them. So a lot of it gets paced by how, how ready and how quickly can a customer put the recharging infrastructure in place. We're talking about electrification, but another area where you even invested heavily and where you've been sort of on the cutting edge, and I think about even some of your defense contract work being tied to this has been autonomy. Yeah. How does that continue to evolve as well? Well, autonomy I think is where we really make a difference as a cusp, as a, as a supplier to our customers and we think about the people that are doing the hard work. We know that autonomy makes a huge difference. It makes a difference in how safe people are. If you look at one of our boom lifts and the JLG product line and we've got all sorts of autonomy on it now to make it really safe for the operator where they're not going to get themselves into a troubled situation with the autonomous functionality and they can just focus on the job that they're up there to do. So we do that across our product lines. It's all about driving productivity. Everybody cares about productivity and it's dry. It's driving safety for people in these in these occupations. That's what our autonomous functionality is all about.