The plan would revise existing service standards from one to three days for first class postal letters to one to five days. USPS said 61% of current first-class mail volume will remain at its current standard.
This would move more deliveries to trucks rather than planes, consolidate mail processing and reduce hours at some retail outlets. The plan assumes $ 44 billion in additional revenue from price increases, but officials declined to provide further details.
USPS Postmaster General Louis DeJoy, a supporter of former President Donald Trump who was named USPS head last year, said without changes the Postal Service would need to a “government bailout” – something he doesn’t want to pursue.
DeJoy acknowledges that USPS performed poorly during the holiday season as it was inundated with package deliveries even as the volume of first-class mail declined.
The USPS needs significant financial relief from Congress and the Biden administration from pre-funding obligations and other changes that could address $ 58 billion in anticipated losses.
US House Speaker Nancy Pelosi criticized DeJoy’s plan, but said Congress would ensure in an upcoming infrastructure bill that “the Postal Service has the resources to serve the people. American”.
The USPS reported net losses totaling $ 86.7 billion from 2007 to 2020. One reason for the red ink is that Congress passed legislation in 2006 requiring the USPS to pre-fund more than $ 120 billion. in health care and retiree pensions.
Representative Carolyn Maloney, who chairs the USPS oversight committee, circulated a bill to address USPS financial problems.
DeJoy says current standards are “not achievable.” For the last fiscal year, the average performance of first-class courier services was 89.7%, well below target.
The plan invests $ 4 billion to renovate retail outlets, consolidates some postal locations in the city, and seeks to transport more first-class mail by truck rather than by air. USPS does not have its own planes.
USPS has also said it could commit to a fully electric delivery fleet by 2035 with help from Congress – and has pledged to spend $ 11 billion on vehicles over the next decade. Earlier this month, USPS said it could electrify its fleet to the “maximum extent” operationally feasible if it received $ 8 billion in government assistance.
In February, USPS selected Oshkosh Defense for a multibillion-dollar contract to manufacture up to 165,000 delivery vehicles, rejecting an all-electric bid from Workhorse Group.