Oshkosh loses bid to continue building Army's JLTV troop transport trucks
Oshkosh Defense will no longer be the U.S. military's lead supplier of the Joint Light Transport Vehicle, or JLTV, a troop transport vehicle that has brought billions in revenue to the company over nearly a decade.
The U.S. Army last week announced the award of a five year, $8.7 billion contract to AM General, a South Bend, Indiana, military truck manufacturing company, to make more than 20,000 trucks and nearly 10,000 trailers. The contract includes a five-year renewal option.
In a statement, Oshkosh Defense said it is pursuing a debriefing from the government about the decision and could not provide additional comment.
Oshkosh Defense won the initial contract to build the JLTV, a replacement for the Humvee, in 2015, beating out several competitors including AM General, which makes the Humvee. Since then Oshkosh Defense has built more than 19,000 JLTVs and 3,500 trailers. The company has more than 125 patents on the vehicles and related technologies, and has been investing in new technology such as a hybrid electric version of the truck.
Oshkosh Defense employs about 5,000 people.
It remains under contract to build thousands of additional trucks. In December it received its latest contract, a $543 million order for for 1,681 trucks and 618 trailers.
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In a statement, the U.S. Army said the award of the contract to build the updated JLTV A2 follows a strategy that was designed to "provide a fair and competitive environment, while ensuring the Army obtained a premier manufacturer that delivers the highest quality, most capable, and affordable tactical vehicle in the world."
In its request for proposals, the Army sought technology to improve on-the-move fuel economy and incorporated anti-idle features that automatically cut engine power to the JLTV during periods of extended idling to reduce fuel use and allow for "silent watch." It will be the first tactical wheeled vehicle to use lithium-ion batteries, which is a key enabler for anti-idle capability.
“We look forward to partnering with AM General to build upon this proven platform and ensure our warfighters have the latest in vehicle technology,” said Brig. Gen. David Walsh, commander of U.S. Marine Corps Systems Command.
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Oshkosh Corp. at the end of Janurary reported net annual sales of $8.3 billion, up 4.1% from the previous year. The defense division accounted for about 26% of those sales, or $2.1 billion. That made it the company's second largest business segment, behind it JLG access equipment division which posted $4 billion in sales for the year.
Oshkosh Defense had been optimistic that its history with the JLTV program would give it an edge in the competition for the new contract.
“Oshkosh has spent the past eight years optimizing its manufacturing and design processes and building a robust supply chain with maximized efficiencies,” George Mansfield, vice president and general manager of Joint Programs for Oshkosh Defense said in December.
Oshkosh Defense is preparing a plant in South Carolina for production of the U.S. Postal Services 's Next Generation Delivery Vehicle.
In December, an initial order for 50,000 trucks was increased to 60,000 trucks in December. Three-fourths of those trucks will be battery-electric vehicles, or BEVs, under the revised contract. The initial contract called for less than 20% of those trucks to be electric.
The company expects a "significant ramp up in production in 2024 and 2025," Mike Pack, Oshkosh Corp.'s executive vice-president and chief financial officer, said during the company's Jan. 31 earnings call.
Oshkosh Defense is also among the competitors for the U.S. military's next generation of heavy-duty military transport trucks, known as Common Tactical Trucks, or CTTs. That contract is expected to be awarded in 2026.
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This article originally appeared on Milwaukee Journal Sentinel: Oshkosh Defense loses bid for $8.7billion JLTV truck, trailer contract
