Postal Service proposes increases in peak-season parcel-delivery rates

The U.S. Postal Service proposed on Wednesday a series of rate hikes on peak-season parcel-delivery services within the U.S.

The increases, which are planned to start Oct. 3 and run until Jan. 23, will fluctuate depending on parcel weight and distance traveled. For example, for the agency’s First Class Package Service, Retail Ground and Parcel Select Ground services, retail rates will increase by $5.85 per package for deliveries of parcels weighing between 26 to 70 pounds and moving more than 601 miles. 

By contrast, retail rates will increase by just 25 cents per package for deliveries of parcels weighing up to 10 pounds and moving under 600 miles.

Commercial customers will pay less than retail customers for the same services, the Postal Service said.

Parcel Select Ground and Retail Ground target users shipping heavier packages and willing to sacrifice faster transit times for lower rates. Parcel Select Ground, under which parcel consolidators gather huge volumes of packages and place them deep into the postal network for last-mile deliveries, is aimed at commercial shippers. Retail Ground, which features single-piece shipments handled end-to-end by the Postal Service, is sold at postal counters to noncommercial customers. The maximum parcel weight for both products is 70 pounds. 

The Postal Service will consolidate those shipments with those moving under its First Class Package Service, which targets shippers of parcels weighing up to 1 pound.

Rates for other Parcel Select services will increase by double-digit percentages. However, the actual increases will be less than $1 per parcel because the base rates for those services are already very low. The Postal Service said it will not increase rates for deliveries of certain lightweight parcels moving under the Parcel Select umbrella. This is a break for businesses shipping goods that typically weigh less than 1 pound.

Commercial users of the Postal Service’s Priority Mail two- to three-day delivery service, as well as its Priority Mail Express overnight delivery service, will pay as much as $6.50 more per parcel for longer-haul deliveries of packages weighing 26 to 70 pounds. Customers shipping parcels weighing 10 pounds or less over shorter distances will pay only 25 cents more per parcel.

The rate adjustments must be approved by the Postal Regulatory Commission before they can take effect. The commission is an independent agency that regulates the Postal Service’s products, services and pricing.

Source: freightwaves - Postal Service proposes increases in peak-season parcel-delivery rates
Editor: Mark Solomon