SMRs and AMRs

Tuesday, March 02, 2010

Postal Service expected to announce 'significant changes'

By Ed O'Keefe
Washington Post Staff Writer
Tuesday, March 2, 2010

The U.S. Postal Service will release projections Tuesday that confirm for the first time the suspicion that mail volume will never return to pre-recession levels. In response, the agency is pushing anew for a dramatic reshaping of how Americans get and send their letters and packages.

Customers are continuing to migrate to the Internet and to cheaper standard-mail options, and away from the Postal Service's signature product -- first-class mail, Postmaster General John E. Potter will report in announcing the projections.

The Postal Service experienced a 13 percent drop in mail volume last fiscal year, more than double any previous decline, and lost $3.8 billion. The projections anticipate steeper drops in mail volume and revenue over the next 10 years, and mounting labor costs only complicate the agency's path to firm fiscal footing.

In an effort to offset some of the losses, Potter seeks more flexibility in the coming year to set delivery schedules, prices and labor costs. The changes could mean an end to Saturday deliveries, longer delivery times for letters and packages, higher postage-stamp prices that exceed the rate of inflation, and the potential for future layoffs.

(More here.)

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