The U.S. Postal Service cannot rebuild its finances through cuts alone. Postmaster David Steiner said Friday.
Steiner said: Agency with 150 years of history needs to expand its revenue base to regain its dominance in the domestic delivery network. They also need to take advantage of the long-standing legal obligation to deliver to all addresses.
Steiner said one way to do that is to work with more customers to offer final or “last mile” deliveries to homes and businesses, which is the most expensive and labor-intensive part of a delivery.
“I’ve always said you can’t cut costs on the road to prosperity,” Steiner said. “We have to grow up.”
Steiner said the Postal Service. faced with an uncertain future Since President Donald Trump was elected to a second term, the company is currently negotiating contracts with private delivery service UPS and similar companies to expand its last-mile service. He said USPS also wants to open its program to large and small retailers and offer same-day and next-day delivery.
“We have started discussions with a number of retailers and the desire for fast, reliable and affordable delivery is certainly strong among all retailers,” he said. “Our value lies in being in every address six, often seven days a week, providing a superior retail and processing footprint.”
Mr. Steiner, who became postmaster general in July, previously served as director of FedEx Shipping Services.
Postal services face major financial challenges
In a new financial report released Friday, operating revenue increased $916 million from the previous fiscal year to $80.5 billion, while the Postal Service suffered a total net loss of $9 billion. This was a slight improvement from the previous year, when the company had a net loss of $9.5 billion.
Amber McReynolds, who was re-elected as chair of the Postal Management Board on Friday, said “years of unnecessary restrictions” have weighed on USPS revenues and “highlights the urgent need for executive and legislative action” to ensure the long-term financial sustainability of the Postal Service. The USPS is an independent, largely autonomous federal agency.
He said the Postal Service currently has to pay a “disproportionate contribution” to its retirement system compared to other federal agencies. He added that they are only allowed to invest their postal retirement funds in Treasury securities, meaning they would lose hundreds of billions of dollars that could be invested in a diversified portfolio.
McReynolds also called on Congress to update the USPS rate structure, workers’ compensation program and borrowing limits, which have remained unchanged since 1991.
“This is urgent and it’s time to act,” she said.
Steiner warned Friday that the Postal Service needs to cut costs, become more efficient and use innovative methods such as introducing artificial intelligence into the USPS logistics network.
“To do all of this, you need the ability to leverage capital and assets,” he said. “We should be able to borrow just like our competitors without being restricted by law.”
Stick to the modernization plan
Steiner, who said he has visited more than 20 postal facilities and spoken to thousands of postal workers and stakeholders in his first 100 days in office, said Friday that he intends to largely maintain the $40 billion, 10-year modernization and fiscal stabilization plan laid out by his predecessor. Louis Dejoy.
He said advances to date have allowed the USPS to “reach new levels,” noting that on-time mail delivery has steadily improved and most customers can expect their mail and packages to be delivered within three days on average. However, he said further improvements were still needed.
As the busy holiday season approaches, Steiner said the Postal Service is ready, noting that $20 billion has been spent over the past four years to modernize mail processing and logistics. Additionally, “workforce stabilization” will require hiring only a “modest” seasonal workforce of around 14,000.
On Friday, several members of the public expressed concern about the possibility of the Postal Service being privatized, but one thought raised by President Donald Trump And his former adviser Elon Musk, McReynolds tried to shoot down that idea.
“There are no proposals or plans to privatize the postal services,” he said. “The new Postmaster General talked about that at length in his public comments, and the board certainly shares that sentiment.”
