• on Jul 28th, 2014 in Mail Processing & Transportation | 89 comments

    What should the postal vehicle of the future look like? The U.S. Postal Service recently put that question to its carriers and vehicle maintenance personnel and is currently reviewing the feedback. It’s an important question because the delivery fleet is aging and the Postal Service needs to quickly replace it. In fact, our recent audit on the topic found the current fleet can only meet delivery needs through fiscal year 2017 – and that assumes no unexpected decrease in vehicle inventory or increase in the number of motorized routes.

    About 142,000 long-life vehicles (LLVs) out of the 190,000-vehicle total delivery fleet are near or have exceeded their expected service life. Replacing these aging vehicles is daunting, particularly given the Postal Service’s financial constraints.

    But fleet replacement isn’t just a major challenge; it’s also a big opportunity. Because the LLVs are up to 27 years old, they aren’t as fuel efficient as newer models. They also lack many of the safety features now considered standard for vehicle fleets, such as back-up cameras, front airbags, and anti-lock brakes. The next generation of vehicles can incorporate the latest safety and environmental bells and whistles, which will protect employees, cut down on fuel costs, and help the Postal Service meet its sustainability goals. Also, given the growth in packages, new vehicle designs could address the challenges of larger and irregularly shaped items.

    The Postal Service has a short- and long-term vehicle fleet acquisition strategy, but we found the plan lacks details such as vehicle specifications and green technology features. Also, despite 3 years of effort, the plan has not been approved or fully funded due primarily to the Postal Service’s lack of capital. Given the urgent need to upgrade the fleet, we are encouraging the Postal Service to make some incremental purchases while formalizing a more specific long-term plan for the next generation of LLVs.

    What are your thoughts on future postal vehicles? What should they look like? What safety and environmental features or other technologies would you like the Postal Service to add? 

  • on Jan 27th, 2014 in Mail Processing & Transportation | 3 comments

    It’s back to the future for the requirement that all letter and flat automation mailings be Full-Service Intelligent Mail barcode (IMb) compliant to obtain discounts. Mailers were expecting implementation this week of the Full-Service requirement, but the U.S. Postal Service pushed back the date until 2015 because the Postal Regulatory Commission ruled that the mandate constituted a price increase that would have busted the inflation-based price cap.

    Many mailers welcomed the delay, as few felt the entire industry – the Postal Service included – was ready for full-service, which included the requirement that barcodes keep their unique sequence of numbers for at least 45 days before the barcode sequence is used again. A number of large mailers have been Full-Service IMb compliant for months and have taken advantage of the benefits of IMbs, including tracking of service performance, identifying bottlenecks, and coordinating follow-up marketing efforts. But many mid-sized and smaller mailers were not ready for the added requirements, which include electronic submission of postage statements and use of unique IMbs on trays and containers. And concerns were growing that the Postal Service’s systems are not yet capable of handling the expected increase in IMb data.

    The Office of Inspector General raised similar concerns in a fall audit report. In particular, we found the Postal Service had fallen short in developing a comprehensive plan for the continued development and use of IMb data. Notably, the Postal Service’s plans around the use of IMb data have grown considerably since its original vision of the program and it has not taken into account the needs of all mailers. The Postal Service needs to upgrade its data storage capabilities and data systems to accommodate the growing use of IMbs and to support stakeholders’ needs.

    The silver lining in this delay could be that it gives the Postal Service another year to develop a comprehensive IMb data plan that includes detailed input from all business users and identifies costs and milestones for the life of the IMb program. It also gives mailers more time to get ready, while letting those already in the Full-Service IMb program keep their modest discounts.

    • Share your thoughts on the Full-Service IMb and the delayed implementation date.
    • Do you think another year will make a difference in the readiness of mailers? Of the Postal Service’s systems?
    • What incentives would you like to see to encourage smaller mailers to make the conversion to Full-Service IMb?
    • If you are already Full-Service compliant, what value do you get from the program? 
  • on Aug 19th, 2013 in Mail Processing & Transportation | 11 comments

    Alternative fueled vehicles are gaining renewed interest with the abundance of cheap, domestic natural gas. Compressed natural gas (CNG) vehicles took off in the 1990s as infrastructure development surged. Service stations then declined for a decade but are now resurging. Liquefied natural gas and ethanol are other options, as is a new clean fuel called GDiesel, a combination of conventional diesel and natural gas that can be used on conventional diesel engines without modifications.

    With so many attractive options and an aging delivery fleet in need of an upgrade, the time seems ripe for the U.S. Postal Service to convert or retrofit its fleet. But a quick overhaul remains problematic given a significant hurdle: the Postal Service lacks capital to make a major investment. Another question is where the Postal Service should place its bets. Should it convert to an electric fleet or go with CNG or are the emerging hybrid technologies the way to go? Should it put all its eggs in one basket or should it convert parts of the fleet to different fuels? How does the Postal Service remain flexible enough to adapt to the best technology knowing that rapid innovation in the alternative fuel sector means the next best thing could be right around the corner?

    The Postal Service has set a target of increasing alternative fuel use in postal vehicles by 10 percent annually through 2015. It also has goals for reducing postal-vehicle petroleum use and contract transportation petroleum use by 20 percent annually in that time. In its 2012 Sustainability Report, the Postal Service notes that it continues to take proactive steps to increase the use of alternative fuels. It is testing many types of alternative fuels, including fuel cell vehicle, electric long-life vehicles, and new hybrid technologies. “Providing affordable delivery service requires our use of alternate fuels that are conveniently available and competitively priced,” the Postal Service said in the report.

    Converting or retrofitting the fleet to an alternative fuel has to make sense financially and logistically based on how the Postal Service operates. Lower fuel costs make the financial benefits of alternative fuels easier to justify. Their environmental benefits are well documented. But logistics remain an issue. If refueling stations are not conveniently or strategically located, the Postal Service has to travel further from its routes. This can affect service and costs.

    Share your thoughts on the best strategy for an alternative fuel fleet. Should the Postal Service throw in with one type of fuel or continue experimenting with a number of options? Should it set more aggressive goals for reducing its use of petroleum and increasing its alternative fuel use? Or does its financial situation limit its ability to move aggressively in those areas?

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