Chunghwa Post Co is to raise the price of its delivery services next year, its first price hike in 24 years.
The decision was made after the Legislative Yuan’s Transportation Committee yesterday passed a resolution that would see the state-run company raise the price of sending direct mail related to political campaigns or other mail sent in large quantities without specific recipients or addresses from NT$0.86 to NT$1.4 per delivery to NT$3.5 per delivery, with the policy set to take effect in March next year.
In reviewing Chunghwa Post’s budget, Democratic Progressive Party (DPP) Legislator Yeh Yi-jin (葉宜津) highlighted the losses it incurred delivering large quantities of direct mail, saying that the cost of delivering direct mail is even cheaper than that of a mobile text message, which typically cost NT$1.1 to NT$1.5 per message.
“Mail carriers are actually like sweat shops because their labor is expended so cheaply on delivering direct mail. The low prices are a good deal for private businesses, but the treasury is losing money,” she said.
It is time to raise the price for delivering business mail as well as other mail services, which have not been changed for 24 years, she said, adding that it is unreasonable to expect taxpayers to subsidize the deliveries of private companies.
Apart from spending more on salaries, she said the postal company’s effort to change its service model to become more competitive with private couriers “sucks.”
Private mail carriers offer mobile-phone apps that allow customers to track registered mail, Yeh said, adding that carriers can also pick up or deliver mail at a customer’s convenience.
However, people using Chunghwa Post registered mail services are only able to do so during a post office’s opening hours, she said.
Chinese Nationalist Party (KMT) Legislator Yang Li-huan (楊麗環) and DPP legislators Chen Ou-po (陳歐珀) and Kuan Bi-ling (管碧玲) said the profitability of Chunghwa Post’s mail business has declined 4.47 percent this year compared with the same period last year.
Chunghwa Post should take advantage of the business opportunities created by the boom in e-commerce business, which has seen phenomenal growth from NT$562.6 billion (US$17.04 billion) in 2011 to an estimated NT$1.127 trillion this year, they said.
Chunghwa Post chairman Philip Weng (翁文祺) said he agreed with lawmakers’ proposals that the postage prices be raised, adding that the company is hopeful its mail businesses will break even next year.
The post office’s online shopping site, Post Mall, is finally beginning to turn a profit after being in the red for five years, he said.
The company struggles with legal restrictions on its e-commerce business, Weng said, adding that the company is not able to reward employees who make good sales with bonuses, as seen in the private sector, and that the government’s plan to cap overtime working hours next year would also impact profits.
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