Bloomberg
Postal Service Seeks Five-Day Delivery by Early 2011 (Update2)
March 29, 2010, 4:13 PM EDT
More From Businessweek
By Angela Greiling Keane
March 29 (Bloomberg) -- The U.S. Postal Service would cut Saturday mail delivery starting in the first half of 2011 under a plan the agency will give its regulator tomorrow.
The Postal Service, which forecasts a $238 billion budget deficit by 2020, says it would save about $3.3 billion in the first year from eliminating deliveries on one day and $5.1 billion a year by 2020.
âGiven the fact that weâre facing such a huge deficit, weâd like to move as quickly as possible,â Postmaster General John Potter told reporters today in Washington.
The Postal Service will file its five-day delivery proposal with the Postal Regulatory Commission in Washington. It is also seeking permission to scale back service from the Congress, which requires delivery to all U.S. addresses six days a week.
The agency proposes to keep open local offices on Saturdays and process and transport mail during the weekends after dropping deliveries to homes and businesses.
The Postal Service said the plan will eliminate the equivalent of 40,000 full-time jobs and would help it return to solvency as mail volumes erode because customers switch to electronic communication. The Postal Service also is seeking to expand its retail offerings, reduce its workforce through attrition and change a requirement that it pre-fund its retiree health care costs.
The commission has 90 days to review the proposal and issue a non-binding opinion, Potter said. âAs with all actions by the Postal Regulatory Commission, we give them great consideration,â he said.
Immediate Needs Ignored
Commission Chairman Ruth Goldway faulted the Postal Service for ignoring short-term financial needs and possible remedies in writing a âthoughtful and comprehensiveâ report.
âIt does not address the immediate crisis, nor what the Postal Service might reasonably be expected to do to avoid insolvency by the beginning of FY 2011 without congressional intervention,â Goldway wrote today in the introduction to an annual report on Postal Service performance.
The National Association of Letter Carriers, representing employees who deliver mail in cities, called cutting Saturday delivery ârisky and counterproductive.â
âThe Postal Service should stand down on this reckless drive to end Saturday delivery,â association President Fredric V. Rolando said today in a statement.
A survey conducted in August for the Postal Service by Maritz Research in St. Louis found 68 percent of 2,200 residential and small-business customers favored five-day delivery, and more than half the businesses said Saturday delivery âis unimportant.â
Postal Service Seeks Five-Day Delivery by Early 2011 (Update2)
March 29, 2010, 4:13 PM EDT
More From Businessweek
By Angela Greiling Keane
March 29 (Bloomberg) -- The U.S. Postal Service would cut Saturday mail delivery starting in the first half of 2011 under a plan the agency will give its regulator tomorrow.
The Postal Service, which forecasts a $238 billion budget deficit by 2020, says it would save about $3.3 billion in the first year from eliminating deliveries on one day and $5.1 billion a year by 2020.
âGiven the fact that weâre facing such a huge deficit, weâd like to move as quickly as possible,â Postmaster General John Potter told reporters today in Washington.
The Postal Service will file its five-day delivery proposal with the Postal Regulatory Commission in Washington. It is also seeking permission to scale back service from the Congress, which requires delivery to all U.S. addresses six days a week.
The agency proposes to keep open local offices on Saturdays and process and transport mail during the weekends after dropping deliveries to homes and businesses.
The Postal Service said the plan will eliminate the equivalent of 40,000 full-time jobs and would help it return to solvency as mail volumes erode because customers switch to electronic communication. The Postal Service also is seeking to expand its retail offerings, reduce its workforce through attrition and change a requirement that it pre-fund its retiree health care costs.
The commission has 90 days to review the proposal and issue a non-binding opinion, Potter said. âAs with all actions by the Postal Regulatory Commission, we give them great consideration,â he said.
Immediate Needs Ignored
Commission Chairman Ruth Goldway faulted the Postal Service for ignoring short-term financial needs and possible remedies in writing a âthoughtful and comprehensiveâ report.
âIt does not address the immediate crisis, nor what the Postal Service might reasonably be expected to do to avoid insolvency by the beginning of FY 2011 without congressional intervention,â Goldway wrote today in the introduction to an annual report on Postal Service performance.
The National Association of Letter Carriers, representing employees who deliver mail in cities, called cutting Saturday delivery ârisky and counterproductive.â
âThe Postal Service should stand down on this reckless drive to end Saturday delivery,â association President Fredric V. Rolando said today in a statement.
A survey conducted in August for the Postal Service by Maritz Research in St. Louis found 68 percent of 2,200 residential and small-business customers favored five-day delivery, and more than half the businesses said Saturday delivery âis unimportant.â
