On Friday, the United States Postal Service (USPS) announced its intention to implement a significant price increase for high-volume shippers using its Parcel Select service. 

The proposed average price hike of 25% is set to take effect on July 14, pending approval from the Postal Regulatory Commission.

The decision to raise prices comes as USPS plans to discontinue incentives for parties that aggregate mail volume from multiple shippers and deliver it directly to the destination delivery unit.

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• USPS seeks 25% price hike for high-volume Parcel Select shipping, effective July 14

• First-class mail stamp prices to rise from 68 cents to 73 cents, pending approval

• USPS faces financial challenges, implements 10-year restructuring plan to cut losses

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USPS Proposes 25% Price Hike for High-Volume Package Shipping

However, the proposed price hike excludes USPS Ground Advantage package shipping.

This announcement follows last month’s revelation that USPS intends to increase the price of first-class mail stamps from 68 to 73 cents, effective July 14. 

If approved, this would result in a 7.8% increase in mailing services product prices. 

Since early 2019, stamp prices have risen by an astonishing 36%.

USPS has been grappling with financial challenges. 

On Thursday, the agency reported a $6.5 billion net loss for the 12 months ending September 30, 2022, as first-class mail volume dropped to its lowest level since 1968. 

The agency also reported a second-quarter net loss of $1.5 billion.

A bipartisan group of 26 U.S. senators recently urged USPS to halt further consolidation of its processing and delivery network, cautioning that such actions could lead to slower mail deliveries. 

The agency is currently undergoing a 10-year restructuring plan to reduce its projected $160 billion losses.

U.S. Postmaster Louis DeJoy addressed the situation on Thursday, stating that the postal service’s “massive and complex evolution” includes rectifying decades of haphazard decision-making and neglect of the physical infrastructure network. 

He emphasized the need for improvements within the time limits available for the agency’s survival.

As part of its restructuring efforts, USPS has been increasing stamp prices twice a year and anticipates that its new pricing policy will generate an additional $44 billion in revenue by 2031. 

In April 2022, President Joe Biden signed legislation providing USPS approximately $50 billion in financial relief over the next decade.

The proposed price hike for high-volume package shipping and the ongoing restructuring efforts highlight the challenges USPS faces as it strives to maintain its services and ensure its long-term viability in an increasingly digital age.

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