Postal Service To Shut Plants

Closing processing centers will result in annual savings of $2.1 bln.

The U.S. Postal Service, after backing off plans to close rural post offices, will stick with its proposal to shut mail-processing centers, eliminating 5 percent of its workforce and saving $2.1 billion annually.

The service, after a loss of $3.2 billion in the quarter ended March 31 and predicting it will temporarily run out of cash in October, intends to close about 140 plants in the next year and about 90 in 2014, Chief Operating Officer Megan Brennan told reporters today on a conference call. A first phase will save $1.2 billion a year, she said.

Closings Suspension

The closings will be suspended from September through December for the U.S. November elections and the peak year-end holiday mailing period, the service said in a memorandum faxed yesterday to postal unions.

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