CNF ASKS POSTAL SERVICE FOR RATE INCREASE
CNF Transportation has asked the U.S. Postal Service to pay more for the
services CNF provides to manage Priority Mail deliveries in the eastern U.S.
CNF was awarded the $2 billion Priority Mail contract in 1997 and says
it needs the rate increase to meet profit margin goals.
CNF expects an answer to the recommendation within two months. An
increase would have no effect on mail prices, although it would have a
retroactive effect on CNF’s first quarter earnings.
CNF reported operating income of $3.5 million from the Priority Mail
contract, compared with a loss of $17.6 million in 1998’s first quarter.
Priority Mail revenue more than doubled to $118.2 million from $42.9