What happened
Shares of electric-vehicle (EV) upstart Workhorse Group (WKHS +0.00%) fell 22% in December, according to data provided by S&P Global Market Intelligence, as some of the wind came out of the company's sails.
So what
The biggest news of the month was that the U.S. Postal Service is delaying a decision on who will get a contract to build next-generation trucks for its fleet. The contract could be worth $6 billion and Workhorse was seen as a frontrunner, so this could be a big blow to the company.
Image source: Getty Images.
To be clear, a decision has not been made about the contract; what was announced was simply a delay. An announcement is expected by the end of March, according to a USPS spokesperson.
Now what
I don't think a delay in the USPS contract fundamentally changes the future for Workhorse, but it puts more risk in the company's operations. Investors were betting it can be a growth stock in the industrial EV space, serving big customers like the USPS. That bullish thesis could still come to fruition, but Workhorse has a lot of work to do, and investors are still taking on risk given that the company has yet to reach large-scale production yet.
