Japan's Yamato Transport: Cheaper Mail Delivery?

Yamato Transport Co. (J.YMT or 9064) is considering introducing by next April a cheaper mail delivery service to rival Japan’s public postal service, a company spokesman said Friday. Though the company has not finalized details of the new service, it hopes to revise its fee system and introduce a cheaper service that can compete with the Y80-a-letter delivery fee charged by Japan’s public post offices, the official said. Currently Yamato’s lowest mail service fee is Y160 for the delivery of catalogs, brochures and magazines. Yamato has already decided not to enter the postal service business after the state-run service is liberalized next April. Yamato is Japan’s largest door-to-door parcel delivery company. The cabinet of Prime Minister Junichiro Koizumi has decided to liberalize the state-run postal services in April 2003 by conducting them under a new public postal corporation and allowing private companies to make letter deliveries. Yamato has decided not to enter the letter delivery service, saying the strict entry requirements set by Koizumi’s bill will mean the planned liberalization is far from a deregulation for fair competition. The government has not made it clear whether private companies will be able to deliver direct mail and envelopes containing credit cards. The bill has not yet cleared Parliament. ‘Under the current circumstance, we will need to expand the existing mail service,’ the Yamato official said. Yamato will consider delivering small-sized mail from companies and individuals, the official said. Other leading parcel delivery companies, such as Nippon Express Co. (J.NPE or 9062) and unlisted Sagawa Express Co., have not decided whether to enter the letter delivery business. On the Tokyo Stock Exchange midday Friday, Yamato shares were down 2.0% at Y2,230. The Nikkei 225 Stock Average was 1.5% lower.