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4/14/2009



Rail News: Rail Industry Trends

U.S. Postal Service to launch two-year LTL test


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The U.S. Postal Service will begin a two-year market test of less-than-truckload (LTL) services on May 6, according to Stifel Nicolaus & Co. Inc. analyst David Ross, citing a recent Postal Regulatory Commission filing.

Although the Postal Service likely wouldn’t become a “large player” in the LTL market, it could compete with LTL carriers such as Arkansas Best Corp., Con-Way Inc., Old Dominion Freight Line Inc., Saia Inc., Vitran Corp. and YRC Worldwide Inc., because the industry continues to grapple with “significant overcapacity,” Ross said in a research note issued Monday.

“One extra competitor should be good for shippers, but not for the margins and yields of other carriers,” he added.

— By Desiree J. Hanford. A Chicago-based free-lance writer, Hanford covered the equities market, including transportation, for Dow Jones & Co. for 10 years.


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