The US Postal Service has awarded five-year air transport contracts for mail worth a total of over$1 billion to seven airlines and a separate mail handling contract to Pitney Bowes. USPS says the
contracts for the first year – fiscal year 2007 – amount to $225 million to carry some 450 millionpounds of mail.The lion’s share of the volume will be transported by American Airlines and ContinentalAirlines, who announced last week that their contracts amounted to $500 million and $258 million,respectively, over the five years.
The other five successful bidders were American Trans Air, JetBlue Airways, Midwest Airlines,Sun Country Airlines and US Airways.
On-time delivery requirements and performance standards, established by the postal service in2003, form a key part of the agreements.
“By achieving consistent, on-time delivery, the performance standards implemented three yearsago have helped us improve customer service overall,” said USPS network operations vice-presidentTony Pajunas. “The new agreements ensure that – together with the airlines – we will continue toprovide the highest levels of service.”
“(They) also contain tracking provisions so USPS can account for a customer’s mail the entiretime it is in the air transportation system,” Pajunas added.
“The airlines are required to scan mail at three key points: when they take possession fromthe postal service or when mail is loaded onto a flight; during transfers to connecting flights;and when mail is delivered to the postal service after the flight’s arrival.”
The contracts cover domestic transport of express mail and first-class mail, and prioritymail originating from designated Transportation Security Administration sites.
Meanwhile, USPS has awarded a four-year contract, renewable for another four years, to PitneyBowes Government Solutions to manage its Atlanta transfer centre.
Worth up to $53 million, the agreement is for Pitney Bowes to handle and sort mail as well asmanage and operate the terminal, which has an annual volume of some 26 million trays, tubs andpouches.
“By combining our best practices and expertise in managing critical components of themailstream with industry-leading technology, we can deliver service excellence and enhancedefficiency at the Atlanta facility,” said Pitney Bowes Government Solutions president, Jon Love.
Pitney Bowes, which claims to provide the world’s most comprehensive suite of mailstreamsoftware, hardware, services and solutions to help companies improve their mail, document andpackage flow, had revenues of $5.5 billion last year, serving more than two million businessesthrough direct and dealer operations and employing 34,000 workers worldwide.
