3. INTERNATIONAL TRANSPORTATION
a. International Air Transportation

The Postal Service continues to align its air transportation strategy with providing universal service that satisfies the global delivery requirements of American businesses and consumers. In 2002, the Postal Service spent $161.2 million on international air transportation to more than 188 foreign postal administrations. This represented a $27 million decline over the previous year as export volumes from the United States declined due to global economic conditions. U.S.-flag suppliers were paid $132.3 million, and foreign-flag suppliers received $28.9 million. The use of foreign-flag suppliers, particularly for airmail service, expands the Postal Service’s ability to reach destinations where U.S.-flag suppliers do not provide the required service. In addition, the cost of military mail, reimbursed by the Department of Defense, increased by $24.5 million to $146.2 million over the previous year, reflecting growing deployment of military personnel in various regions of the world.


b. International Surface Transportation

The cost of international surface transportation by ocean decreased from $6.6 million in 2001 to $5 million in 2002. Ocean surface transportation suppliers are selected on the basis of a best value, comparative analysis of proposals.


c. Terminal Dues and Transit Charges

Under the acts of the Universal Postal Union (UPU), each postal administration that receives mail from another administration has the right to collect from the sending administration a payment for the costs incurred in processing and delivering mail received from that administration; those charges are called terminal dues. Additionally, the UPU provides for transit charges for mail which is exchanged between administrations through a third country. Transit charges are paid by the sending country to the intermediary country for forwarding mail to the destination.

In 2002, the Postal Service paid $428 million for both terminal dues and transit charges compared to $477.2 million in 2001.


4. Postal Service-Owned Transportation

	Vehicle Type	2002 Inventory
	1/4-Ton	1,695
	1/2-Ton	173,329
	1-Ton	1,257
	2 and 1/2-Ton	7,617
	Cargo Vans	2,398
	Tractors	1,841
	Spotters	405
	Trailers	5,080
	Service	1,257
	Administrative	5,284
	Law Enforcement	2,913
	Mobile Post Office	211
	Miscellaneous	131
	Total Owned	207,256

	Number of Vehicles	208,291
	Miles Traveled	1,151,200,093
	Miles per Gallon	9.6
	Cost per Vehicle	$4,026.45
	Cost per Mile	$0.75

5. Mail Transport Equipment

The Mail Transport Equipment (MTE) contract service provides an integrated network (i.e., distribution, logistics/network management, and information services supporting tracking and tracing) for the Postal Service’s mail handling equipment. Five operational suppliers manage 22 MTE service contract sites broken out by city clusters of normally three pairs. These city clusters are located throughout the United States. Moreover, the network is operated through an Operating Systems Integration and Management contract. Six fixed price contracts were competitively awarded among five suppliers in 1998. The contracts have a 5-year basic contract period and one 5-year option period. During 2002, the MTE service contracts processed more than 1,148,000,000 units valued at $220.0 million.

The independent and externally administered Customer Satisfaction Measurement system consistently shows high marks, from both premier and national accounts, for the availability of serviceable MTE.