The Postal Service’s plans to consolidate facilities across its network may create an opportunity to expand the number of electric vehicles in its next-generation fleet.

USPS announced Wednesday that it would soon publish a Notice of Intent that will supplement the Final Environmental Impact Statement for its next-generation delivery vehicle (NGDV) fleet.

USPS said that update will reflect its plans to consolidate its delivery facilities across the country, which may justify the agency purchasing more electric vehicles as part of its next-generation fleet.

“Delivery network and related route refinements may alter the appropriate mix of vehicles to be procured under the NGDV contract,” the agency said Wednesday.

Postmaster General Louis DeJoy, speaking at the National Postal Forum in Phoenix last month, said USPS will consolidate delivery units into Sort and Delivery Centers, with enough space, docks and mail processing equipment to operate more efficiently than its current infrastructure.

DeJoy, speaking Thursday at a Reuters event on supply chain execution in Chicago, elaborated on the agency’s consolidation plans.

“We are consolidating our routes. Our routes, which normally might have 20, 24 carriers and reach 40,000 people, will now have 300, 400 carriers and reach 600,000 people,” DeJoy said.

USPS, he added, operates 220,000 routes that deliver to 160 million addresses six days a week.

DeJoy said this consolidation would add more miles to most delivery routes, and that longer routes would result in a better cost analysis for electric vehicles.

Letter carriers affected by this consolidation would drive more miles out to their delivery stops, and more miles to return to the Sort and Delivery Centers.

DeJoy said the plan would also streamline the charging infrastructure for electric vehicles, as it would reduce the number of facilities where charging stations are needed.

“The big, big risk in this is the infrastructure to accommodate for this. Well, we’re going to use a lot of our old plants and existing plants. We have hundreds and hundreds of them around the country. They have good amperage, they’re industrial facilities, and they can accept the infrastructure that’s necessary,” DeJoy said.

USPS delivery vehicles currently operate from almost 19,000 delivery units around the country.

DeJoy said he spoke with members of Congress yesterday before USPS announced it would update its environmental impact statement.

“I need to get vehicles, and we’ll explore electric vehicles as it makes financial sense,” he said. “There will be a lot of politicians saying they forced us into this. Not so! This is going to be an ongoing financial analysis, and where it applies and where we can accommodate, we’re going to do it, just like I said from the beginning.”

House Oversight and Reform Committee Chairwoman Carolyn Maloney (D-N.Y.), in a hearing last month, called on USPS to increase the number of electric vehicles that it purchases, and has requested documents from USPS on its fleet acquisition plans. 

Maloney said in a statement Wednesday that she was pleased by the USPS announcement to update its environmental impact statement.

“The Postal Service’s original EIS was deeply flawed, which is why I have been urging the Postal Service to issue a new EIS for months. Neither the Postal Service nor the American people can afford a gas-guzzling postal fleet that will damage our environment when clean, electric vehicles are an option,” Maloney said.

Maloney said she still has many questions about USPS plans to consolidate facilities and “will be monitoring this closely to ensure that mail is delivered on time as the American people expect and deserve.”

Joe Britton, executive director of the Zero Emission Transportation Association, said USPS still plans on “locking in decades of reliance on gas-powered trucks” as part of its next-generation fleet.

“We saw USPS ignore the crucial cost savings and societal benefits that electrification would bring to its delivery service and the public, using an error-ridden environmental analysis to justify procuring an overwhelmingly gas-powered fleet that will leave Americans worse off,” Britton said.

As part of this consolidation, DeJoy said USPS will close annexes around the country “that add cost, transportation and foster inefficient and ad-hoc operations.”

Annexes are USPS facilities separate from post offices used for mail delivery functions, but may not offer full retail services to customers. USPS said the consolidation will not change its retail presence.

DeJoy said these changes to the USPS network and local operations will take years to accomplish, but said each plant and delivery unit included in this overhaul “will provide immediate, systemwide benefits.”

To get USPS to break even starting in 2024, after 15 years of net financial losses, DeJoy said USPS needs to cut costs and increase revenue.

But with continued declines in first-class mail, the most profitable product for USPS, DeJoy said the agency is looking to expand its package business.

“Mail volume has continued to go down, so I have to supplement it with something. Home delivery is expected to go up somewhere between 4% and 8%. We’re going to capitalize on our piece of that,” he said.

To become a bigger player in the competitive package business, DeJoy said large regional plants, like one a million-square-foot facility being built in Atlanta, will help USPS reach more customers.

“You can enter a product into that plant and hit 5 million people next-day. And when we consolidate our delivery units, you can enter into our delivery units, like a lot of big players do, and instead of reaching, you know, 40,000 people, you can reach 750,000 people — next-day, if you do it in the afternoon, maybe same-day,” DeJoy said.

The network transformation initiative will impact nearly 500 network mail processing locations, 1,000 transfer hubs and 100,000 carrier routes. It will also impact 10,000 delivery units, which USPS defines as post offices, stations, branches or carrier annexes that handle mail delivery functions.

USPS announced in March it spent nearly $3 billion on 50,000 next-generation vehicles as part of its initial order to the vendor Oshkosh Defense. More than 10,000 vehicles as part of that initial order are electric vehicles — double its previous estimate.

USPS expects electric vehicles will make up at least 10% of its next-generation fleet, but remains open to purchasing more electric vehicles if its finances improve, or if Congress authorizes funding to support its acquisition.

USPS officials recently told the House Oversight and Reform Committee the agency was able to purchase more electric vehicles than previously expected because of the rising cost of gasoline, as well as long-term savings the agency is counting on, now that Congress has passed the first major piece of postal reform legislation in 15 years.

USPS is facing three separate lawsuits over its plans to purchase mostly gas-powered vehicles as part of its next-generation fleet.

The lawsuits argue USPS set the estimated cost for electric vehicles unrealistically high as part of its environmental impact statement but placed a low bar for the future price of gasoline.

USPS expects next-generation vehicles, including electric vehicles, will first appear on routes in late 2023.

USPS began its search for replacement vehicles in 2015. Next-generation delivery vehicles will have air conditioning and heating and improved ergonomics.

The vehicles will also have 360-degree cameras, advanced braking and traction control, airbags, and a front-and rear-collision avoidance system that includes visual, audio warning, and automatic braking.

The vehicles will also have increased cargo capacity to maximize efficiency and better accommodate higher mail and package volumes.

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