(Montreal) Last week, Justin Trudeau said out loud what many were wondering as the postal strike was in its fourth week.
Posted at 1:23 p.m.
Christopher Reynolds
The Canadian Press
“This endangers the long-term viability of Canada Post as a service that Canadians rely on,” said the Prime Minister.
Speaking to reporters in Halifax on December 9, Mr. Trudeau warned that the country could “get through the holiday season and everyone would find alternatives” to the national postal service.
In fact, the strike may have pushed some customers away for good, leaving the cash-strapped state-owned company in an even worse situation and forcing a significant change in strategy.
The month-long work stoppage, set to end Tuesday following a ministerial directive and the decision of the Canada Industrial Relations Board, has resulted in the daily shipment of millions of items being halted.
It has prompted tens of thousands of small businesses and individuals to turn to private carriers for the delivery of their packages.
Many businesses will likely return to Canada Post because of its low shipping rates, but others who find efficient alternatives in regional courier services may never return, observed Ian Lee, associate professor at the Sprott School of Business at Carleton University.
“These parcel delivery companies will see this as an opportunity to gain new customers. They might lower their prices a little bit to try to be a little more competitive,” he said, citing carriers ranging from FedEx and UPS to new e-bike couriers.
Declining use
“Canada Post will lose customers,” said Mr. Lee.
This is already the case. According to last year’s annual report, the Postal Service’s package market share fell to 29%, from 62% before the COVID-19 pandemic, as Amazon and other competitors took advantage growing demand for next-day home deliveries.
As the package delivery market has exploded in recent years, Canada Post’s shipments have declined – by almost a quarter since 2020 to reach 296 million packages in 2023.
Demand for postal mail could also decline. Last year, the average household received two letters per week, compared to seven per week in 2006.
Closing postal services will only hasten the decades-long migration to the internet for sending Christmas cards, checks and bills, Lee said.
“This will accelerate the digitalization of everything. Companies will say, ‘Well, I don’t want to be stuck like that again,’ he said. Canada Post will lose more customers. »
Return to work
Nonetheless, mail is set to start flowing again Tuesday after Labor Minister Steven MacKinnon asked the Canada Industrial Relations Board to order employees to return to work if the court determines that an agreement cannot be reached. was not possible by the end of the year. The minister shared on the X platform on Monday that the council had declared an impasse and therefore a resumption of operations.
Meanwhile, Mr MacKinnon announced he would appoint a labor relations commission of inquiry to examine “structural issues of the dispute” and make recommendations by May 15 on how to reach a new agreement.
He said the investigation will be broad in scope, as it will look at the entire structure of Canada Post, both from a customer and business model perspective, given the difficult business environment. that Canada Post is currently facing.
