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PostNL Seeks Subsidies Amid Declining Mail Volume
Dutch postal company PostNL is requesting a 2-cent subsidy per letter to offset losses stemming from a notable decline in mail volume. The company reports a 90% decrease in letter volume as 2000, mirroring a trend across Europe. Currently, PostNL is obligated to deliver standard mail within 24 hours, a requirement that will shift to 48 hours starting July 2024, a change approved by outgoing Minister of Economic Affairs Vincent Karremans to provide “more air” for the company’s business model.
though,PostNL CEO Hielke Berendsen argues that the extended delivery timeframe alone is insufficient to address the financial challenges. He stated that the current losses are unsustainable and that even the Authority for Consumers & Markets (ACM) acknowledges that expecting a commercial entity to operate at a loss is unreasonable. Berendsen emphasized the relatively small financial impact of the requested subsidy.
While PostNL’s parcel delivery service remains profitable, Berendsen dismissed the idea of cross-subsidizing letter delivery with parcel revenue. He cited unfair competition with companies in other European countries that have received more ample government support.
The situation reflects a broader European trend. in Denmark, PostNord, co-owned by the Swedish and Danish governments, will cease letter delivery services in 2024. Spokesperson Isabella Beck Jørgensen explained that despite extending delivery times to five working days a decade ago, the service remained financially unsustainable. Danes will still be able to send letters through option, more expensive delivery services, such as parcel post.
