US: Amazon lobbies to keep USPS prices low

Amazon, along with other retail and logistics companies, announced the creation of a new group that will lobby to keep the US Postal Service’s (USPS) delivery services “reliable and affordable.”

The announcement comes days before a task force, set up by President Donald Trump, is due to recommend postal reforms to the White House. Trump said that the USPS was “on an unsustainable financial path and must be restructured to prevent a taxpayer-funded bailout.”

In May, months after Trump tweeted criticisms of the USPS, news surfaced that the president had personally asked US Postmaster General Megan Brennan to double its shipping rates for Amazon and other firms. If that were to occur, these companies could be out billions of dollars.

Members of the new Package Coalition include Columbia Sportswear, pharmacy benefits manager Express Scripts, the National Retail Federation, package shipping firm OSM Worldwide, postal service company Pitney Bowes, Publishers Clearing House, and the retailer QVC.

“These companies just want to ensure that decisions are made based on a clear understanding of what the facts are,” said John McHugh, the coalition chairman, according to Reuters. “The package service portion of the postal service’s business model is one of the few bright spots. It makes money.”

McHugh, a former member of Congress who served as chairman of the postal service subcommittee, said package rate hikes—not based on market prices—could actually reduce demand and revenue for the USPS.

“Earlier today, we sent out emails asking for meetings with both House and Senate members,” he added. “We view this as a long-term effort.”

According to Trump’s executive order, the USPS has lost US$65 billion since the 2007 to 2009 financial crisis. The service is supposed to be self-sustaining, and must ask Congress for permission before it can raise rates. The USPS is also responsible for pre-funding decades-worth of retiree health benefits.

Full Content: PYMNTS

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.