Japan Post's Mail Business Faces Growing Losses

Japan Post has reported a substantial increase in its operating loss for the mail business in fiscal 2023, driven by a steep decline in domestic mail use. The operating loss reached nearly 90 billion yen ($580 million) for the year ending in March, more than four times the loss recorded in fiscal 2022. This marks the second consecutive year in the red since Japan Post's privatisation in 2007.

The decline in the use of domestic mail items, such as letters and postcards, has been significant, with volumes down nearly 50% from their peak in fiscal 2001. Additionally, rising transportation costs have further squeezed margins.

In response, Japan Post plans to raise postal rates from October, with standard-size mail seeing a 30% price hike.

The communications ministry projects that these changes will help the mail business return to profitability by fiscal 2025. However, the ministry also warns that the business is expected to fall back into the red the following year.