Royal Mail has called for its regulator to protect it from last mile delivery competitors such as TNT Post, claiming that TNT’s expansion plans could cut £200m from its annual turnover.
In a report to Ofcom, which is also currently investigating a complaint made by TNT Post about changes to Royal Mail’s Access contracts, the post and parcel operator claimed it has to deliver items that TNT Post sees as unprofitable or difficult to deliver.
It accused it of ‘cherry picking’ deliveries in urban areas and offering a less-frequent service. TNT Post currently delivers every other day, rather than six-days a week, Royal Mail added.
“The mandatory access regime means we must handle any item TNT Post does not wish to deliver itself,” it said.
The report also claimed that Royal Mail’s upfront costs will increase as more players enter the last mile delivery market and reduce its market share.
The operator also estimated that TNT’s planned expansion could reduce its turnover by £200m in 2017-18 as it takes on more last mile deliveries in urban areas. It has so far this year introduced the service in Liverpool andHarrow in north west London.
In response, TNT Post said competition is a “crucial ingredient for making a more efficient Royal Mail”.
It said in a statement: “There is not a shred of evidence that postal delivery competition is a threat to the USO (universal service obligation). Royal Mail should respond to the challenge of the internet and the opportunity presented by postal competition which will actually make for a more sustainable Royal Mail which is better able to deliver the USO in the years ahead.”
