May 10 (Bloomberg) -- The U.S. Postal Service added to its losses in the second quarter and is closer to needing “extreme action” to keep it afloat, Postmaster General Patrick Donahoe said.
Donahoe said that without legislation to change the service’s business model, mounting losses will necessitate heeding the postal board’s call to ask labor unions to reopen contracts and to consider raising postal rates.
“At some point our financial liabilities become so large that they cannot be fixed without taking extreme action,” Donahoe said today at a board meeting in Washington. “We don’t want to get to the point where extreme action is the only option.”
The service lost $1.9 billion in its second quarter ending March 31, narrowing the loss from $3.2 billion a year earlier in the same quarter as it reduced its workforce by nearly 5 percent, Chief Financial Officer Joseph Corbett said at the meeting.
The service is a government agency that is supposed to be self-supporting from postage sales.
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