More money for Continental


Aug 20, 2002
Post Office offers New Mail Contracts

.c The Associated Press

WASHINGTON (AP) - The post office awarded contracts Friday that will allow it to begin shipping mail on the airlines that offer the best service for the lowest price starting June 28.

Currently all 54 certified airlines in the United States share in carrying the mail, with volume divided evenly among carriers operating over the same route. The post office paid the airlines about $370 million last year to carry the mail.

The new system is expected to improve service and cut costs at the same time, said Paul Vogel, postal vice president for network operations management.

Airlines entered bids to carry the mail over various routes, and mail will be sent aboard planes of those that offer the best price.

If service slips on a route, however, the mail will be switched to the carrier with the next best price, said Vogel.

He said the contracts cover about 17 million pounds of mail a week, about the same amount the agency ships by Federal Express under a separate agreement.

The new contracts take effect June 28, a day after the current system expires, Vogel said. He said the agency worked with the Air Transport Association, the airlines'' trade group, and with airline officials in setting up the new system.

Because the new deals vary from airline to airline, and the agency can shift mail depending on service, the final cost won''t be known until the end of the fiscal year, the post office said.

Vogel noted that mail volume has dropped sharply since the attacks on Sept. 11, 2001, both because of the slump in the economy and restrictions to what can be sent on passenger airplanes.

The new contracts include a provision that the airlines must track the mail, scanning barcodes when they receive it, transfer it between planes and deliver it to postal officials at its destination. That will allow the agency to measure performance, Vogel said, an incentive for the airlines to move the mail quickly.

Failure to meet on-time performance standards for any route could result in the airline losing business to competing airlines. If there is more mail than the carrier can carry, the additional mail is provided to the airline with the next best value, the post office said.

Vogel announced 18 contracts Friday, but he said about 34 airlines will be involved in carrying mail as subsidiaries or partners of other airlines.

The contracts announced are to:

ABXAirborne Inc., Wilmington, Ohio.

Air Flamenco, San Juan, Puerto Rico.

American Airlines, Dallas.

America West Airlines, Phoenix.

American Trans Air, Indianapolis.

BAX Global Inc., Irvine, Calif.

Continental Airlines, Houston.

Delta/United Airlines, Atlanta, Chicago, Denver.

Four Star Aviation, San Juan, Puerto Rico.

Frontier Airlines, Denver.

JetBlue Airways, New York City.

M&N Aviation Inc., San Juan, Puerto Rico.

Midwest Express Airlines, Milwaukee.

Northwest Airlines, Minneapolis.

Roblex Aviation, San Juan, Puerto Rico.

Southwest Airlines, Dallas.

Spirit Air, Miramar, Fla.

US Airways, Washington.

On the Net: U.S. Postal Service:

04/25/03 16:11 EDT

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