FTA warns Post Office on parcels traffic
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THE POST OFFICE will lose :he lucrative portion of parcels :raffic unless it finds a solution :o its financial difficulties ither than merely increasing tharges. This warning has been given by the FTA to the Post 3ffice Users National Council.
Basically, the Association las reiterated the views it ex)ressed in January when comnenting on the last price inTeases. Any radical new apn-oach to the situation, says he FTA, should be based, irst on steps to reduce costs, ind secondly on the pricing neehanism.
The current Post Office pro)osal took no account of the :ompetitive situation and if iersisted with could result ■ nly in a major diversion of parcels traffic.
At the same time the FTA feared an exploitation of the resultant situation with other national smalls carrying companies raising their charges other than on cost grounds.
Events had confirmed the FTA's January judgment of the situation and the further increases now proposed would lead to further diversion in traffic resulting in still higher unit costs.
Because, over a wide range of weights the charges for parcels post would ordinarily be uncompetitive, it would have to be snlved as a premium high-class service. Any reduction in the standard of service could therefore be counterproductive.