Postal Service Cuts International Mail Rates
Apr. 26, 1989
WASHINGTON (AP) _ The U.S. Postal Service slashed its price for international express mail in an effort to increase its share of the business.
Assistant Postmaster General Peter K. Eichorn announced Tuesday that the rate for express mail packages of a half-pound or less will be $10.75 effective July 1.
Until July 1 the agency will handle those envelopes for what he termed an ''introductory'' price of $8.75 each.
Currently, international express mail up to one-half pound costs $13 to Canada, $15 to Great Britain and $18 to the nearly 100 other nations where the high speed service is available.
Eichhorn said that the service, which delivers parcels in one to three days, is profitable for the Postal Service and he expected the agency to do even better as volume increases.
While lengthy, complex procedures are required for the Postal Service to alter its rates for domestic mail, it has the latitude to change international rates.
The Postal Service carries about 7.4 percent of the 30 million international express parcels sent annually, Eichorn said. He predicted that volume will rise substantially with the new rates.
International express mail is primarily used by businesses, although Eichorn said the lower rates will also bring it within reach of individual consumers.
When expedited international mail was first offered in 1971 the rate was $30 plus $1 per ounce.
The decision was immediately criticized by UPS, a competitor.
UPS spokesman Bob Kenney said, ''Today's announcement by the Postal Service that it is reducing the rate on its international express mail overnight letter to $8.75 and then to $10.75 is another incredible example of a marketing strategy designed solely to maximize postal volume at the expense of private enterprise competitors.
''How could any company faced with rising costs and disappointing productivity levels, as the Postal Service is, justify a rate cut of more than 50 per cent? The answer is simply that this service offering is not based on USPS cost factors.