USPS set to cut back on airfreight

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On May 1, the United States Postal Service is taking additional actions to improve service reliability by announcing the implementation of changes to the First-Class Package Service (FCPS) service standards. This initiative is part of “Delivering for America,” the Postal Service’s 10-year plan to achieve financial sustainability and service excellence. A fact sheet on the proposed changes to service standards for first class packages is available here: Delivering for America: Our Vision and Ten-Year Plan to Achieve Financial Sustainability and Service Excellence – about.usps.com

Modifying these service standards will allow for additional transport time for long-distance package deliveries and increased network efficiencies. The new FCPS service standards will also enable additional package volume to be transported by surface transportation, which is more reliable and affordable compared to air transportation.

Sixty-four percent of First-Class Package Service volume will be unaffected by the proposed standard changes. Four percent will be upgraded from a 3-day to 2-day service standard. For the remainder of the volume (32%), the service standard will increase by one or two days.

“Modifying select service standards is a key growth element and enabler of our 10-year plan. This action will contribute to our cost savings efforts and improve our reliability across all product classes, including our growing package market,” said postmaster general and CEO Louis DeJoy. “By implementing the elements of our 10-year plan, we will deliver the consistent, reliable service that the American people and our customers expect and deserve and grow package volume, spurring revenue growth that can be invested back into the Postal Service.”

The postmaster general previously received an advisory opinion from the Postal Regulatory Commission (PRC) regarding these service standard changes.

Additionally, the Postal Service is removing an extra day for Priority Mail transported via ground. The extra day was temporarily put in place in April 2020 to account for ongoing global supply chain, transportation and employee availability challenges across our network posed by the COVID-19 pandemic. Given the continued high demand on the overall air network, the Postal Service is retaining the extra day at this time for Priority Mail transported via air until the reliability of our key providers improves.

As part of implementing the new service standards for FCPS, the Postal Service is removing the extra day that has applied to FCPS.

Service standards are delivery benchmarks for how long customers can expect the Postal Service to deliver different types of mail from origin to destination — Point A to Point B. Service standards are not the same as the percentage targets or the actual measured service performance.

With full implementation, the postmaster general’s 10-year plan aims to reverse a projected $160 billion in losses over the next 10 years. The Plan’s growth and efficiency initiatives will spur cash flow and savings to make $40 billion in capital investments over the next 10 years – including $20 billion towards the Postal Service’s mail and package processing network, facility upgrades and procurement of new processing equipment.

The Postal Service generally receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.