Soccer moms and commuters aren't the only ones feeling the bite of rising fuel costs - every time the price of gasoline goes up a penny it costs the US Postal Service $8 million.
"We are definitely feeling the pressure," Deputy Postmaster General Patrick R. Donahoe said. Transportation cost the post office $6.5 billion in 2007, $500 million more than the year before.
The post office operates the largest civilian fleet of vehicles in the country - 215,000 motor vehicles - and also faces rising costs for fuel from its contract carriers including truckers and airlines.
It's both a matter or costs and usage, Donahoe explained - looking for ways to reduce costs and change use patterns to reduce the need for fuel.
It's easier for the post office to raise rates than it used to be - the price of sending a letter went up a penny to 42 cents in May. Another price rise is expected next May, but postage increases are legally limited to the rate of inflation.
That limit doesn't seem to apply to fuel costs which now top $4-a-gallon nationwide.
One advantage the post office has is the ability to buy in bulk, so it can get gasoline and diesel fuel at a discount.
Donahoe didn't say what prices the agency has been able to negotiate, but even though it is less than retail, it still goes up over time.
Highway transport of mail cost the post office $3.1 billion last year, up 5.8 percent from the year before.
Still, the deals allow the post office to set up bulk storage to supply its vehicles, and it provides special credit cards to long-haul contractors so they can also take advantage of the discount rather than simply passing along their higher costs.
Another step is simply packing the mail more tightly.
If you can cram mail that used to go into four trucks into three, that's one truck that's not burning diesel fuel, Donahoe explained.
Source: China Daily/Agencies
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