The postage for letters could be increased again next year. Deutsche Post initiated this at the Federal Network Agency. The group is faced with increased costs.
The letter postage of 85 cents is actually fixed until the end of 2024. However, Deutsche Post wants to push through a price increase beforehand and has now applied to the Federal Network Agency for this.
applicable price approval lift
In order to be able to increase postage before the planned date of early 2025, Swiss Post needs the approval of the Federal Network Agency. To this end, the company has now applied to the authorities for the price approval currently in force to be revoked. Specifically, Swiss Post is applying for the revocation of the so-called price cap decision on the basis of which the letter prices were approved.
“The costs and letter volume developments originally assumed by the authorities” did not occur, according to the head of the company’s post and parcel division, Nikola Hagleiter. “In view of the drastically increased costs due to inflation, higher energy prices and the very high collective bargaining agreement for 2023, as well as a significantly sharper decrease in letter volumes, there is no way around an early increase in postage.”
quantity and cost development deviates from forecast
The Federal Network Agency had approved price increases of up to 4.6 percent from 2022 to 2024. The current prices have been in effect since the beginning of 2022, when standard domestic letters rose from 80 to 85 cents. The current volume, sales and cost development deviates significantly from the forecast from 2021, which is based on the prices approved until the end of 2024, the company said.
According to Post, fewer and fewer letters are being sent due to “accelerated substitution through electronic communication”. From the company’s point of view, the costs have recently increased due to higher wages for the workforce: “The wage agreement negotiated with the ver.di union a few weeks ago alone will burden Deutsche Post with additional costs of around 400 million euros this year and 800 million euros a year 2024”, according to the group. The company sees the legal conditions for an early price increase as given. In any case, the price for a standard letter is currently 85 cents, well below the European average price of 1.33 euros.
Further price increases already decided
According to Post, price increases have already been decided for certain products for private customers in the parcel sector and for business customers in the advertising mail sector. The private customer price for the ten-kilo package will rise from 9.49 to 10.49 euros on July 1st. In the case of products for business customers, Swiss Post can itself increase prices without authorisation. The company has already announced additional price increases as of July 1, 2023 in the areas of parcels, mail communication and dialogue marketing.
As a so-called universal service provider, Deutsche Post is the only company that has to deliver letters everywhere in Germany – not just in cities, where delivery costs are relatively low, but also in rural areas. In addition, they must fulfill obligations regarding the branch network, mailbox accessibility and the speed of mail delivery.