USPS adds fuel surcharge

The United States Postal Service plans to add a temporary 8% surcharge to several package services starting April 26, pending regulatory review. (about.usps.com) The Postal Service said it filed notice with the Postal Regulatory Commission on March 25, and the Postal Service’s governors approved the change on March 24. The increase would apply to Priority Mail Express, Priority Mail, United States Postal Service Ground Advantage, and Parcel Select. (about.usps.com) The agency said First-Class stamps and other products would not be affected. If regulators allow it, the surcharge would begin at midnight Central Time on April 26 and expire at midnight Central Time on January 17, 2027. (about.usps.com) The Postal Service said the change is tied to higher transportation costs and described it as a short-term bridge to a permanent pricing mechanism for competitive products. It also said rival carriers already use fuel surcharges and that its new charge would be less than one-third of what competitors charge for fuel alone. (about.usps.com) That package-price increase lands while the agency is still trying to fund a nationwide network that reaches more than 170 million addresses six and often seven days a week. The Postal Service said it is also in the middle of a network modernization plan tied to long-term financial sustainability. (about.usps.com) Brookings fellow Elena Patel wrote on March 13 that the Postal Service has operated at a loss every year since 2007 and has reached its statutory borrowing limit. Patel wrote that Postal Service leadership has warned it could exhaust available cash within a year. (brookings.edu) Patel also wrote that the older model, in which letter mail paid for the universal service obligation, has been weakened by the long decline in mail volume. Her March 10 analysis said postal systems in Europe and the Americas are facing the same mix of falling letter volumes and high fixed delivery costs. (brookings.edu, brookings.edu) Retailers pushed back quickly. The Retail Industry Leaders Association said on April 1 that the proposal raised questions about affordability, predictability, and broader postal reform for businesses that depend on shipping prices. (mininggazette.com) The Postal Regulatory Commission still has to review the filing before the surcharge can take effect. For now, the clearest line is this one: stamps stay the same, but shipping a package through several Postal Service products is about to cost more. (about.usps.com)