WASHINGTON – The U.S. Postal Service (USPS) on Tuesday unveiled a proposed 10-year strategic plan that would slow current current first-class delivery standards and raise prices to cut $ 160 billion in red ink over the next decade.
The plan would revise existing service standards from one to three days for first-class mail letters to one to five days. The USPS said 61% of the current volume of first-class mail will remain at its current standard.
It would change more deliveries to trucks than planes, strengthen mail processing and reduce hours at some retail outlets. The plan involves additional revenue of $ 44 billion from rising prices, but officials declined to provide further details.
USPS General Louis DeJoy, a supporter of former President Donald Trump who was appointed last year to lead the USPS, said unchanged that the Postal Service would need a “government rescue” – something he did not want to look for.
DeJoy acknowledges that the USPS performed poorly during the holiday season as it was flooded with package deliveries, even as first-class mail volume declined.
The USPS needs a significant financial exemption from Congress and the Biden administration from pre-financing obligations and other changes that could address the anticipated $ 58 billion loss.
U.S. House Speaker Nancy Pelosi criticized DeJoy’s plan, but said Congress would provide a future bill on infrastructure. “The postal service has the resources to serve the American people.”
The USPS reported a total net loss of $ 86.7 billion from 2007 to 2020. One reason for the red ink is that Congress passed legislation in 2006 that required the USPS to pre-finance more than $ 120 billion in liabilities for the health care of pensioners and pensions.
Representative Carolyn Maloney, who chairs the USPS oversight committee, distributed draft legislation to address the USPS ‘financial problems.
DeJoy says current standards “are not achievable.” For the last budget year, the average performance of first-class postal services was 89.7%, significantly below target.
The plan is investing $ 4 billion in refurbishing retail outlets, consolidating some of the city’s postal locations and trying to move more first-class e-mails by truck than by air. USPS does not own its own aircraft.
The USPS has also said it can commit to a fully electric delivery fleet by 2035 with congressional assistance – and promises to spend $ 11 billion on vehicles over the next decade. Earlier this month, the USPS said it could electrify its fleet to the “maximum extent” operationally feasible if it received $ 8 billion in government assistance.
In February, the USPS selected Oshkosh Defense for a multi-billion dollar contract to manufacture up to 165,000 delivery vehicles, rejecting a fully electric bid from the Workhorse Group.