Federal law requires that much of the first class mail be delivered to a 1-day (overnight) service standard. The closing of the MEM airport center is a result of the fact that the post office is effectively removing most first class mail from the air system by eliminating the 1 day/overnight service standard. First class mail does not compete with FedEx delivery products (think bills, junk mail and periodicals). No service standard changes are planned, as of now, for what the post office calls “competitive products” like express and priority mail.
The 250 mail processing centers on the current closure list are, for the most part, not located in cities with FedEx air hubs. In about 2 years the consolidated postal processing network will more closely resembles the FedEx network. I don’t see it so much as turning over all air ops to FedEx as much as streamlining their network to resemble the FedEx network to gain efficiency. Network efficiency is good for business, but bad for labor.
The post office may increase their weak competitive edge as a result of the new streamlined network, but the potentially huge tremor is the removal of first class mail from the air system. First class mail is essentially highly subsidized volume which makes up a substantial portion of the total volume shipped through the dedicated postal air network. Combine the overall loss in subsidized non-competitive volume with the streamlining of the existing postal network which now carries exclusively competitive product and both parties might lose interest in the current version of the dedicated postal air network in 2013.
Last edited by kjq10a; 12-12-2011 at 05:08 PM.