It’s not easy to find something the entire postal community can agree on. But the U.S. Postal Service’s need to replace its delivery vehicles just might get all heads nodding.
Given package volume growth, the Postal Service needs vehicles with increased cargo-handling capacity to replace the existing fleet of left hand drive (LHD) vehicles, many of which have exceeded their end-of-life projections. They also have expensive ongoing operating costs that exceed the vehicles’ value.
The Postal Service has made investments to replace over 12,000 delivery vehicles. Its plan includes an investment review process, which in 2014 and 2015 included approval of two decision analysis reports (DARs). These DARs called for replacing 2006 model year vehicles with off-the-shelf, commercially available, extended capacity LHD delivery vehicles. The new vehicles have 400 cubic feet of cargo capacity, compared to the old vehicles’ 140 cubic feet.
USPS deployed the new LHD vehicles as planned but retained just over 7,600 vehicles originally slated for replacement. Why? To maintain delivery service because package volume and delivery points had grown beyond projections.
We reviewed the Postal Service’s LHD delivery acquisition to determine if it achieved performance metrics, costs, and savings. We found the Postal Service spent less than it expected because management obtained a lower price during contract negotiations and did not have to use contingency funding.
However, we found USPS did not fully achieve the expected net savings for the first DAR because the DAR program manager didn’t coordinate with Finance and Planning to reduce savings from annual field budgets. The Postal Service did realize full net savings for the second DAR.
Our recommendations centered on improving the process going forward so future DARs reflect field budget savings and so performance metrics are more adequately tracked and reported.
How do you find the new LHDs compared with the old ones? What improvements are most noticeable?