Deutsche Post wins approval to deliver UK mail
DEUTSCHE POST has become the first of the big foreign postal operators to attempt to show the loss-making Royal Mail that it can deliver the post more efficiently.
The German company yesterday was awarded an interim licence from the regulator Postcomm, pitting against the likes of Hays and Express Dairies’ milk floats in the battle to provide an alternative to Royal Mail.
The temporary licence, which will last for one year, will allow Deutsche Post to deliver bulk mail sent out by businesses in batches of 4,000 or more items at a time. Initially, it limits the Germany company to handling 40 million letters a year – half the amount carried each day by the Royal Mail, or Consignia as it will still be known until the end of the year.
Deutsche Post said that 90 per cent of the mail it collects and sorts will still be passed to the Royal Mail for final delivery. Its own sub-contractors will deliver the remaining 10 per cent.
The Royal Mail, which is losing more than pounds 1m a day, has signalled that it could lose up to pounds 500m of business to rival operators when the market is thrown open to competition next January.
From the start of 2003, rival operators such as Deutsche Post will be able to obtain a licence lasting at least seven years, allowing them to compete for up to 30 per cent of the Royal Mail’s former monopoly. Competitors will be able take a further third of the UK postal market from 2005 and from 2007 the Royal Mail will be competing in a deregulated marketplace.
The Royal Mail and Postcomm have yet to agree on how much it will be allowed to charge rival operators for access and use of its local delivery network. Postcomm said it expects an agreement to be finalised within the next four weeks. Postcomm added that Deutsche Post’s licence would not undermine Royal Mail’s ability to deliver to every address in the country at a uniform price.
Deutsche Post, which has been hit in its home market by a demand from the German regulator for a cut in the price of stamps, already operates a joint venture with Securicor to carry parcels and freight in the UK.
Copyright: Independent Newspapers(UK) Limited
