Tag: Royal Mail

Royal Mail pledge over post market competition

Posted by | Dec 30, 2005 | |

Royal Mail today vowed to “fight for every letter” following the New Year’s Day postal revolution in which it will lose its 350-year monopoly on deliveries.

The UK’s postal service market will be opened up on January 1, allowing rival companies to collect, sort and deliver mail for the first time since the reign of Charles II.

Royal Mail faces competition from 14 companies which have already registered with regulator Postcomm to handle post in the UK, including German firm Deutsche Post and Dutch postal service TNT.

Most of the competition is expected to be in business mail, which accounts for 80% of the market and helped boost Royal Mail profits by 20% to £159 million in the first half of 2005.

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UK Royal Mail ‘needs GBP2bn to fight new competition’

Posted by | Dec 30, 2005 | |

Royal Mail said today that it needed to invest GBP2bn in modernisation as it braces itself for an onslaught of new competition from January 1. No less than 14 companies have registered with regulator Postcomm to handle post in the UK, including German firm Deutsche Post and Dutch postal service TNT. Royal Mail said it would “fight for every letter”, but stressed the importance of new investment. “Royal Mail will fight hard for every single letter. Royal Mail is determined to compete successfully in the open market – but in order to do so we need a fair regulatory regime and the ability to invest GBP2bn in the modernisation of the business,” Royal Mail spokesman David Simpson said.

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Rivals snap at the heels of UK Royal Mail

Posted by | Dec 29, 2005 | |

Royal Mail expects to lose “billions” of mail items to its rivals over the next 12 months, following the opening up of the market to full competition on January 1. And in the change that will follow the New Year’s day revolution in the postal services market, it is business customers that are expected to be in the lead. Royal Mail lost its monopoly on mailings of 4,000 and more items in April 2003. Next week, the rest of the Pounds 6.5bn market, including lower volumes of mail sent by small businesses, is being opened up. Companies account for more than 80 per cent of the licensed market: mail costing less than Pounds 1 and weighing less than 350g. Royal Mail’s main competitors include TNT Mail, the UK arm of TPG, the Dutch postal group; DHL Global Mail, the UK arm of Deutsche Post, the German postal operator; and UK Mail, owned by Business Post, a quoted express delivery company. Those competitors say they intend to use the January 1 liberalisation as a catalyst to step up the pressure on the state-owned operator, using a combination of pricing and product innovation to try to woo more of its business customers.

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Minister to talk with UK Royal Mail‘s Leighton after tough efficiency targets agreed

Posted by | Dec 29, 2005 | |

Ministers are to open talks with Royal Mail over its demands for up to Pounds 2bn of investment after the postal operator agreed to tough new targets for improving efficiency. The negotiations, which will run well into the new year, are expected to focus on several options, all of which would involve the government, which is the state-owned postal operator’s sole shareholder, putting public money into the company. With Royal Mail’s financial position precarious, and trade unions fearful of another round of job cuts, its management is lobbying the Department of Trade and Industry for help. One option under discussion would be to provide the company with a loan repayable over a number of years. Another option, favoured by Royal Mail, could be some form of equity investment, not unlike a rights issue, under which the government would inject cash as equity in return for a bigger dividend in future. Alan Johnson, trade and industry secretary, will lead the talks with Allan Leighton, Royal Mail chairman.

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UK watchdog in pledge over postal services

Posted by | Dec 28, 2005 | |

The landmark opening of the UK’s GBP6.5bn postal services market to full competition on January 1 will take five years to have its full impact, the postal regulator has said. But Nigel Stapleton, chairman of Postcomm, stressed the “pace of change” should be faster than the liberalisation of the UK telecoms and energy markets. In an interview with the Financial Times, Mr Stapleton vowed that Postcomm would use its full range of powers including prosecutions to ensure that liberalisation is not accompanied by a collapse in basic service standards. He cited the deregulation of directory enquiries in 2003, which triggered concerns about new entrants to the market giving out the wrong phone numbers, as a cautionary example of the need to protect market integrity. “As far as we’re concerned, a major issue in how successful competition will be is if we can maintain customer confidence,” Mr Stapleton said.

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