Workhorse Awarded Sourcewell Contract for Zero-Emission Commercial Vehicles
Workhorse Group Inc. (Nasdaq: WKHS) has been awarded a Sourcewell contract for procurement in the category of Class 4-8 chassis and cabs with related equipment, accessories, and services. This achievement allows Workhorse to expand its reach to government, educational, and nonprofit sectors across all 50 states and Canada.
Sourcewell, a government agency created by the Minnesota legislature, streamlines the procurement process by combining the purchasing power of numerous agencies. Workhorse's contract with Sourcewell runs until July 9, 2028, with potential one-year extensions. This contract provides streamlined access to Workhorse's portfolio of all-electric medium-duty vehicles, including the W56 step van, W750 step van, and W4 CC cab chassis.
- Awarded Sourcewell contract for Class 4-8 chassis and cabs procurement
- Expanded market reach to government, educational, and nonprofit sectors in 50 states and Canada
- Streamlined access to Workhorse's all-electric medium-duty vehicle portfolio
- Contract runs until July 9, 2028, with potential one-year extensions
- None.
Insights
The recent Sourcewell contract awarded to Workhorse Group Inc. positions the company for substantial growth opportunities. This contract provides Workhorse access to a broad network of government, educational and nonprofit sectors across the United States and Canada, significantly broadening its customer base. Sourcewell's extensive reach will enable Workhorse to scale its operations swiftly and increase its market penetration.
From a market dynamics perspective, this contract could catalyze a shift in fleet procurement towards more sustainable options. By simplifying the purchasing process, Sourcewell has lowered barriers for municipalities and institutions to adopt zero-emission vehicles, enhancing the demand for Workhorse's offerings. This move aligns with increasing regulatory and social pressures to reduce carbon emissions.
Short-term, the impact will be seen in
Financially, the Sourcewell contract is a significant milestone for Workhorse. It not only validates the company's product lineup and competitive positioning but also provides a predictable revenue stream over the next four years, with potential extensions.
The contract's maturity date of July 9, 2028 and the possibility of one-year renewals, indicate a stable and long-term revenue source. Workhorse can leverage this stability to optimize its production planning and allocate resources more efficiently. Furthermore, the guaranteed demand from Sourcewell participants can also improve the company's bargaining power with suppliers, potentially reducing costs and enhancing margins.
Short-term, we can expect positive stock movements as investors react to the enhanced revenue visibility. Long-term, this contract strengthens Workhorse's financial foundation, making it an attractive proposition for potential investors and partners.
CINCINNATI, July 16, 2024 (GLOBE NEWSWIRE) -- Workhorse Group Inc. (Nasdaq: WKHS) (“Workhorse” or “the Company”), an American technology company focused on pioneering the transition to zero-emission commercial vehicles, today announced that it has been awarded a Sourcewell contract for procurement in the category of Class 4-8 chassis and cabs with related equipment, accessories, and services. This significant achievement allows Workhorse to expand its reach to government, educational, and nonprofit sectors within all 50 states and Canada.
Sourcewell is a government agency created by the Minnesota legislature as a local unit of government (Minn. Const. art. XII, sec. 3) and serves as a service cooperative. Sourcewell is dedicated to streamlining the procurement process and combines the purchasing power of numerous agencies into a single cooperative group. Their contracts are competitively solicited to meet the public bidding requirements of participating entities. Workhorse was awarded a Sourcewell contract following a rigorous request for proposal process resulting in contracts that meet, or exceed, local procurement requirements.
As an awarded contract supplier, Workhorse has joined an elite group of vendors approved to serve Sourcewell’s network of members across the United States and Canada. Sourcewell participants now have streamlined access to Workhorse's portfolio of all-electric medium-duty vehicles, including the W56 step van, W750 step van, and W4 CC cab chassis.
“We are honored to be awarded by Sourcewell as an approved provider,” said Ryan Gaul, Workhorse President of Commercial Vehicles. “Sourcewell's streamlined purchasing process satisfies the legal requirement of the traditional bidding process, enabling our customers to quickly and efficiently acquire zero-emission vehicles that meet their operational requirements. Municipalities across the nation are leading the way in the transition to zero-emissions fleets and this contract will allow Workhorse to work with them efficiently to deploy the vehicles they need to meet their plans.”
Contract Information:
Contract Number: #032824-WKH
Maturity Date: July 9, 2028
Contract Renewal: One-year extensions
Learn more about Sourcewell and its contract with Workhorse at sourcewell-mn.gov.
About Sourcewell
Sourcewell is a self-sustaining government organization that partners with education, government, and nonprofits to empower student and community success. Throughout North America, Sourcewell offers a cooperative purchasing program with over 400 awarded suppliers on contract, simplifying the buying process for its members and ensuring they receive the best value for their procurement needs.
About Workhorse Group Inc.
Workhorse is a technology company focused on providing ground-based electric vehicles to the last-mile delivery sector. As an American original equipment manufacturer, we design and build high performance, battery-electric trucks. Workhorse also develops cloud-based, real-time telematics performance monitoring systems that are fully integrated with our vehicles and enable fleet operators to optimize energy and route efficiency. All Workhorse vehicles are designed to make the movement of people and goods more efficient and less harmful to the environment. For additional information visit workhorse.com.
Forward Looking Statements
This press release contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. When used in this document, the words “anticipate,” “expect,” “plan,” “believe,” “seek,” “estimate,” “will,” and “continue” and similar expressions are intended to identify forward-looking statements. These statements involve substantial risks and uncertainties. For a further description of the risks and uncertainties relating to the business of the Company in general, see the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Forward-looking statements speak only as of the date hereof. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions, or circumstances on which any such statement is based, except as required by law.
Media Contact:
Aaron Palash / Greg Klassen
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449
Investor Relations Contact:
Matt Glover and Tom Colton
Gateway Group
949-574-3860
WKHS@gateway-grp.com
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