The U.S. Department of Defense has tapped Oshkosh Corporation to supply its MRAP All Terrain Vehicles for troops in Afghanistan.

Oshkosh will provide an initial 2,244 M-ATVs worth $1.05 billion. The selection comes on the heels of government testing on models from competing manufacturers, including Navistar, Force Dynamics and BAE Systems.

"Our M-ATV design combines the crew protection warfighters have come to expect in MRAP vehicles with the extreme mobility and durability needed to negotiate Afghanistan's mountainous off-road terrain," said Robert Bohn, Oshkosh chairman and chief executive officer.

Oshkosh's shares rose 25 percent in late trading, following the Pentagon's announcement, according to Dow Jones. The company will now focus its efforts on meeting the government's production and delivery requests as soon as possible.

"While we believe we can meet or exceed the government's current delivery requirements, we intend to enter into discussions with other manufacturers to determine if they can assist in the production of the Oshkosh M-ATV," Bohn said.

The new vehicle is equipped with the company's TAK-4 independent suspension system. The company also received a supply order to install more than 1,500 legacy MRAPs with the TAK-4 system. The M-ATV armor system on the trucks was provided by Plasan North America, which also supplied the system for more than 5,000 legacy MRAPs and thousands of Oshkosh Armored Cab MTVRs.

Oshkosh already provides large and medium-size cargo trucks to the military and could be next in line to supply Humvee utility vehicles, Dow Jones said.

Navistar Defense said while it was disappointed by the news of its loss, the company plans to continue actively pursuing military business in the future. "While we recognize we can't win every new program, if it has a diesel engine and wheels, we will pursue it," said Archie Massicotte, president of Navistar Defense.

To read more about how military business has helped heavy-duty truck manufacturers during the recession, see the Class 8 Update in the July issue of Heavy Duty Trucking magazine.