The U.S. Postal Service said Wednesday that it is ending discounts that shipping consolidators such as UPS and DHL use to get packages to the nation's doorsteps, in a move meant to help the Postal Service slow losses but that could see the higher costs passed on to consumers.
Consolidators move about 2 billion packages through the Postal Service each year — accounting for roughly a quarter of its total parcel volume — and the change will boost postal revenues and efficiencies while encouraging shippers to simply use Postal Service services such as Ground Advantage, U.S. Postmaster General Louis DeJoy told The Associated Press.
He insisted the move is aimed at financial sustainability even though it could boost Postal Service market share and make it more costly for consolidators, who could pass on the costs to consumers.
“I’m not trying to take over the package business. I’m just trying to save the mail business,” he said.
The change is overdue, DeJoy said, as the Postal Service seeks to cut losses and deal with changing shipping habits following an 80% drop in first-class mail since 1997. Some consolidator agreements already have been renegotiated while others will be redrawn as contracts expire over the coming year, he said.
“Reevaluating these business arrangements is the right thing to do for the Postal Service and the American people. And of course, we will make agreements with consolidators who are willing to negotiate deals based upon a more rational use of our network in a fashion that is mutually beneficial,” he said.
The changes are part of the Postal Service’s efforts to boost its own Ground Advantage package shipments and to eliminate cheap access to its vast network for the most costly part of shipping — the final leg in which postal carriers make deliveries six days a week to 167 million addresses across the country, DeJoy said.
It affects shipping consolidators that drop off large numbers of packages at about 10,000 locations across the country. Under the new changes, the number of locations will be cut down to about 500 large hubs that are equipped to handle the volume, he said.
The move, signaled in a June filing with the Postal Regulatory Commission, is part of DeJoy’s ongoing efforts to eliminate budget shortfalls and improve efficiency as part of a 10-year plan to achieve financial sustainability.
It doesn't affect large shippers such as Amazon that negotiate deals directly with the Postal Service. But it could mean higher shipping costs for all sorts of products that are shipped by consolidators who have saved money by using the Postal Service network for final deliveries. Some of the big ones are DHL eCommerce and OSM Worldwide. UPS is another consolidator through SurePost and Mail Innovations.
The higher costs for tapping into the Postal Service’s vast network is bad news for consolidators, who have to find cheaper options or risk being dropped by businesses that choose to send products directly through the Postal Service and other carriers, said Satish Jindel, a shipping and logistics and president of ShipMatrix, which produces shipping software.
“Their days are numbered,” he said of consolidators.
Change is already afoot for some consolidators.
Pitney Bowes filed for bankruptcy protection effective next month for its e-commerce division. FedEx is eliminating its FedEx Smart Post that utilized the postal network, and converting it to FedEx Economy Ground using its own trucks and contractors.
FILE - A U.S. Postal Service employee works outside as she makes deliveries in Northbrook, Ill., Monday, June 3, 2024. (AP Photo/Nam Y. Huh, File)
BAMAKO, Mali (AP) — Jihadis attacked a military training camp near the airport in Mali’s capital on Tuesday as explosions were heard in the area. Within hours, the government said it was temporarily closing the airport in Bamako.
A security official said there was unspecified loss of life and significant damage, without elaborating.
A sweep operation was underway after gunmen attempted to infiltrate the Faladie gendarme school, the military said in a statement. The army said the situation was under control and asked people to avoid the area.
The armed extremists who attacked the military training camp have since been neutralized, Oumar Diarra, the army chief of staff, said on national television.
Later, the military confirmed that the attack took place in “multiple locations,” without providing details.
JNIM, which is linked to al-Qaida, claimed responsibility for the attack. Through its media arm, the website Azallaqa, the group said that it had inficted “major human and material losses” and set aircraft on fire. Militant groups often exaggerate their claims.
Earlier in the day, an Associated Press reporter heard two explosions and saw smoke rise in the distance of the camp and airport, both located on the outskirts of the city.
A security official told the AP that the attackers entered the training camp, causing a “loss of life and material damage,” but didn't provide any numbers or specifics. He said they attacked both the training camp and the military base near the airport.
At least 15 suspects were arrested, said the official, who was inside the base at the time of the attack. He spoke on condition of anonymity because he wasn't authorized to talk to reporters.
Soon after the attack, Mali's authorities closed the airport. Mohamed Ould Mamouni, communications officer at the ministry of transport, said flights were suspended indefinitely because of the exchange of gunfire that took place near it.
The U.S. Embassy in Bamako told its staff to remain at home and stay off the roads.
Mali, along with its neighbors Burkina Faso and Niger, has for more than a decade battled an insurgency fought by armed groups, including some allied with al-Qaida and the Islamic State group. Following military coups in all three nations in recent years, the ruling juntas have expelled French forces and turned to Russian mercenary units for security assistance instead.
Since taking power, Col. Assimi Goita has struggled to stave off growing attacks by the jihadis. Attacks in central and northern Mali are increasing. In July, approximately 50 Russian mercenaries in a convoy were killed in an al-Qaida ambush.
The mercenaries had been fighting mostly Tuareg rebels alongside Mali’s army when their convoy was forced to retreat into jihadi territory and ambushed south of the commune of Tinzaouaten.
Attacks in the capital of Bamako are rare, however. In 2022, gunmen struck a Malian army checkpoint about 60 kilometers (40 miles) outside the city, killing at least six people and wounding several others. In 2015, another al-Qaida linked extremist group killed at least 20 people, including one American, during an attack on a hotel in Bamako.
Tuesday's attack is significant because it showed that JNIM has the ability to stage a large-scale attack, Wassim Nasr, a journalist and senior research fellow at the Soufan Center, told the AP.
“It also shows once again that they are concentrating their efforts on military targets, rather than random attacks on civilian targets,” he said.
Sam Mednick reported from Goma, Congo, and Banchereau from Dakar, Senegal.
This video grab shows Malian security personnel detaining a man after Mali's army said a military training camp in the capital Bamako has been attacked early Tuesday, Sept. 17 2024. (AP Photo)
FILE - Leader of Mali's ruling junta Lt. Col. Assimi Goita, center, attends an independence day military parade in Bamako, Mali on Sept. 22, 2022. (AP Photo, File)
