US Postal Service squeeze on shipping consolidators could raise consumer costs

The U.S. Postal Service said Wednesday that it is ending discounts that shipping consolidators such as UPS and DHL use to get packages to the nation's doorsteps, in a move meant to help the Postal Service slow losses but that could see the higher costs passed on to consumers.

Consolidators move about 2 billion packages through the Postal Service each year — accounting for roughly a quarter of its total parcel volume — and the change will boost postal revenues and efficiencies while encouraging shippers to simply use Postal Service services such as Ground Advantage, U.S. Postmaster General Louis DeJoy told The Associated Press.

He insisted the move is aimed at financial sustainability even though it could boost Postal Service market share and make it more costly for consolidators, who could pass on the costs to consumers.

“I’m not trying to take over the package business. I’m just trying to save the mail business,” he said.