German regulator rejects request for postage stamp price hike
Reuters
Published Aug 07, 2023 03:34AM ET
Updated Aug 07, 2023 04:56AM ET
BERLIN (Reuters) -Germany's federal network regulator has rejected a request by postal service operator Deutsche Post (OTC:DPSGY) to raise the price of a postage stamp to cover rising costs, the agency said on Monday.
"We recognise the challenging environment in the letter and parcel business, but according to the data presented, letter prices are sufficient to cover unit costs," said Klaus Mueller, president of the Bundesnetzagentur.
In May, Deutsche Post had applied to the regulator to lift a price cap currently in place until the end of 2024, with the goal of raising its postage stamp prices next year.
Deutsche Post called the decision "wrong", saying the inability to raise prices would massively slow its efforts to reach climate-neutrality.
"The decision exacerbates the cost pressure in the letter mail sector," board member and head of the Post & Paket unit Nikola Hagleitner said in a statement. "Investments in a sustainable universal postal service are hardly possible under these conditions."
The regulator's decision comes after German consumer prices rose by 6.5% on the year in July, according to preliminary data.
Deutsche Post said the cost of a stamp in Germany - 0.85 euros ($0.9331) for a standard letter - was below the European average despite relatively high salaries. It argued that forecasts from 2021 on which current pricing is based were no longer accurate.
"Deutsche Post was unable to prove that reduced mail volumes led to cost increases per letter item - the average unit costs are even slightly below the 2021 forecast," the regulator said in a statement.
($1 = 0.9109 euros)
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.