WASHINGTON, DC — The United States Postal Service announced plans today to transition to a new delivery schedule during the week of Aug. 5, 2013 that includes package delivery Monday through Saturday, and mail delivery Monday through Friday. The Postal Service expects to generate cost savings of approximately $2 billion annually, once the plan is fully implemented.
“The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America’s changing mailing habits,” said Patrick R. Donahoe, Postmaster General and CEO. “We developed this approach by working with our customers to understand their delivery needs and by identifying creative ways to generate significant cost savings.”
Over the past several years, the Postal Service has advocated shifting to a five-day delivery schedule for mail and packages. However, recent strong growth in package delivery (14 percent volume increase since 2010) and projections of continued strong package growth throughout the coming decade led to the revised approach to maintain package delivery six days per week.
“Our customers see strong value in the national delivery platform we provide and maintaining a six-day delivery schedule for packages is an important part of that platform,” said Donahoe. “As consumers increasingly use and rely on delivery services — especially due to the rise of e-commerce — we can play an increasingly vital role as a delivery provider of choice, and as a driver of growth opportunities for America’s businesses.”
Once implemented during August of 2013, mail delivery to street addresses will occur Monday through Friday. Packages will continue to be delivered six days per week. Mail addressed to PO Boxes will continue to be delivered on Saturdays. Post Offices currently open on Saturdays will remain open on Saturdays.
Market research conducted by the Postal Service and independent research by major news organizations indicate that nearly seven out of ten Americans (70 percent) supported the switch to five-day delivery as a way for the Postal Service to reduce costs in its effort to return the organization to financial stability.¹ Support for this approach will likely be even higher since the Postal Service plans to maintain six-day package delivery.
The Postal Service is making the announcement today, more than six months in advance of implementing five-day mail delivery schedule, to give residential and business customers time to plan and adjust. The Postal Service plans to publish specific guidance in the near future for residential and business customers about its new delivery schedule.
Given the ongoing financial challenges, the Postal Service Board of Governors last month directed postal management to accelerate the restructuring of Postal Service operations in order to strengthen Postal Service finances.
“The American public understands the financial challenges of the Postal Service and supports these steps as a responsible and reasonable approach to improving our financial situation,” said Donahoe. “The Postal Service has a responsibility to take the steps necessary to return to long-term financial stability and ensure the continued affordability of the U.S. Mail.”
The operational plan for the new delivery schedule anticipates a combination of employee reassignment and attrition and is expected to achieve cost savings of approximately $2 billion annually when fully implemented.
The Postal Service is currently implementing major restructuring throughout its retail, delivery and mail processing operations. Since 2006, the Postal Service has reduced its annual cost base by approximately $15 billion, reduced the size of its career workforce by 193,000 or 28 percent, and has consolidated more than 200 mail processing locations. During these unprecedented initiatives, the Postal Service continued to deliver record high levels of service to its customers.
While the change in the delivery schedule announced today is one of the actions needed to restore the financial health of the Postal Service, legislative change is urgently needed to address matters outside the Postal Service’s control. The Postal Service continues to seek legislation to provide it with greater flexibility to control costs and generate new revenue and encourages the 113th Congress to make postal reform legislation an urgent priority.
The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.
RESPONSE OF CONGRESSMAN ELIOT ENGEL
POST OFFICE CONTINUES PATH TO OBLIVION
Congressman Eliot Engel (D-NY-16) criticized the U.S. Postal Service plan to end Saturday delivery service by August, calling the move part of a program of eventual elimination of service by the Post Office. In recent months, the Postal Service has closed, or threatened to close scores of post offices and distribution centers, debated eliminating overnight service for First-Class Mail, and wants to sell the Bronx General Post Office building.
“It is a self-fulfilling prophecy – you provide inferior service, and you drive away customers. Once you remove one service, it becomes very easy to slash the next one, and all of a sudden it’s a downward spiral to poorer service. This is a path to oblivion for the Postal Service as they ride a business plan doomed for failure. I want the Post Office to succeed, and for the American people to have ample access to facilities, but I need to see that the Post Office is serious about correcting their own flaws,” said Rep. Engel, a senior member of the House Energy and Commerce Committee.
The Postal Service will stop Saturday deliveries, which it has been making since 1860, beginning on August 1, with delivery service continuing for packages and vital medicine deliveries. Post office facilities will remain open on Saturdays (with reduced hours) enabling customers to drop off mail, buy stamps, or use their post office boxes.
“It is inevitable that the buildings will eventually be closed on Saturdays as well. This will lead to job losses, and inferior services. It is especially problematic for seniors, working families and people living in rural areas. Republicans in Congress have long sought to stack the deck against the Postal Service – culminating in the Postal Act of 2006, which made it virtually impossible for the Postal Service to thrive. That Act, passed by a lame duck Republican Congress, required the Postal Service to pre-fund its future retiree health care benefits – a 75 year liability paid for in 10 years. This, coupled with decades of mismanagement, has put us in this position today. Congress needs to reform this Act and aid the Postal Service in revamping its business plan, and enable it to pursue a path to solvency in the years to come. If not, we will soon be marking the end of the Postal Service altogether,” added Rep. Engel.