2023 Annual Report


Canada Post provides an important publicly owned national infrastructure, connecting the country by serving all addresses in all communities – urban, rural and remote – on a daily basis.

The Canada Post Corporation Act from 1985 created the postal system as we know it today, designed at that time to run as an arm’s-length organization. The responsibility is simple and has remained unchanged: serve all Canadians and operate in a financially self-sustaining manner based on revenue generated by the sale of postal products and services, not taxpayer dollars.

To do so, Canada Post has been continuously responding to change. As the country evolves, so too must the postal service. When Canadians started to receive less mail and more parcels, we pivoted to serve these new mailing habits, with the most significant changes occurring in the last five years.

Since 2019, Canada Post has been undergoing a company-wide transformation designed to serve Canada’s growing appetite for parcel delivery. In 2023, we posted some of our best-ever service results thanks to strategic investments in network capacity. We’ve moved the company forward and focused on improving the customer experience with extensive upgrades to our facilities, sorting equipment, digital platforms and more. We’ve also made important advancements in health and safety, environmental sustainability, and equity, diversity and inclusion.

However, as the country emerged from the pandemic, change in the competitive delivery landscape began to accelerate. The rapid shift in the last two years has been occurring at a pace not seen before in our history.

While we’ve reported on our declining financial situation for a few years, the current competitive landscape has quickly compounded our challenges, which are reaching a critical point. As the landscape has shifted from mail to parcels, cracks are rapidly appearing in the foundation of the postal system.

This report makes it clear that significant change is necessary to modernize and preserve our national postal service. Canada Post is committed to lead that change, understanding the important role it continues to play in connecting all Canadians – in urban, rural and remote communities.

Our current financial picture

  • For 2023, Canada Post recorded a loss before tax of $748 million, compared to a loss before tax of $548 million in 2022.
  • Without changes to address the structural challenges with our operating model, we forecast larger, unsustainable losses in future years.
  • Even with Canada Post’s recently proposed stamp price increase, the Corporation projects that, without additional borrowing and refinancing, it will fall below its required operating and reserve cash requirements by early 2025.

A system built to deliver 5.5 billion letters cannot be sustained on two billion letters

Canada Post is a Crown corporation with a long-standing responsibility to stand on its own financially. It’s a user-pay system, which means when Canadians change their mailing and shipping needs, the postal system must respond; otherwise, revenue suffers. In less than two decades, our country has evolved from peak mail to an era defined by digital commerce. In response, Canada Post has continued to evolve and transform through one of the most rapid and dramatic periods of change in its long history.

From mail to parcels to the pandemic

The Great Mail Decline

Canada hit peak mail volume in 2006. That year, we delivered almost 5.5 billion letters – the product that postal services around the world were built on. The digital communications age was already under way but kicked into high gear as mobile communication exploded. Every year since then, the amount of mail to be delivered has declined – in Canada and around the world.

In 2023, we delivered less than 2.2 billion letters, significantly impacting revenue – and that erosion will continue. Back in 2006, Canadian households received an average of seven letters per week; today it’s two per week. In addition, more than 200,000 new addresses are added each year. We served 17.4 million addresses in 2023, over three million more than in 2006.

The shift from mail to parcels

Canada Post is built to deliver to Canadians and is therefore constantly evolving to serve their changing needs. As letter mail volumes declined, the company began to develop its parcel delivery business to serve the growing, competitive ecommerce market.

The move was successful and parcel revenue grew, making Canada Post the country’s ecommerce delivery leader, at one point delivering two thirds of Canadians’ online orders. By 2021, parcel revenue accounted for half of Canada Post’s annual revenue.

The post-pandemic competitive landscape – the rise of low-cost parcel carriers

Prior to the pandemic, Canada Post already understood that it needed to become more agile and competitive to respond to the demand for reliable and convenient parcel delivery. The company initiated a comprehensive transformation plan in 2019, with several major projects to increase capacity and improve service across the country.

While ecommerce was growing in Canada at a strong annual pace, the pandemic was a game changer. The sudden and lasting boom in demand for ecommerce delivery gave rise to new, privately owned delivery companies. These competitors grew rapidly, leaning on their low-cost-labour business models that rely on contracted drivers to provide lower prices, plus greater convenience with evening and weekend service.

These low-cost private operators have gained significant ground, particularly in the last two years, by focusing on serving international retail giants. Our estimated market share in parcel delivery has quickly eroded by more than half – from 62 per cent prior to the pandemic to 29 per cent in 2023.

Meeting the challenges of serving a changing Canada

Before and after the 1985 Canada Post Corporation Act was implemented, successive governments initiated numerous reviews and regulations to ensure we were meeting our dual purpose to serve all Canadians while operating on a self-sustaining financial basis. The regulatory measures were intended to ensure that Canadians from coast to coast to coast would be well served by their postal service. In the paper-based economy of that era, we fulfilled these responsibilities.

The country we serve today is not the country we served in 1985. The mailing and delivery needs of Canadians across the country have dramatically changed and continue to evolve. However, the regulatory approach has remained largely untouched.

Canadians expect Canada Post and the government to work together as stewards of the national postal service, ensuring it is keeping pace with their changing needs. We must work together to ensure the postal system changes with the times.

Why this matters to Canadians

Without major changes to its legacy operating model, Canada Post cannot keep up with the evolving needs of Canadians, particularly in today’s dynamic and competitive ecommerce market.

An outdated postal system will affect all Canadians, but it will be felt most by those who need it most – small businesses as well as Canadians in rural and remote areas. The postal service is a vital national infrastructure built to serve the entire country, but it is at a difficult crossroads that challenges its very future and relevance.

Change is needed to ensure the postal service is there for all Canadians, especially rural and remote communities and small businesses. In today’s competitive environment, rural, remote and northern communities, with their lower population densities and distance from large urban centres, are costly to deliver to. Canada Post has always been there to serve these communities, delivering a much higher proportion of parcels in rural and remote areas. We’re proud to fulfill this need. But without change, our financial situation will impact our ability to continue to serve these important communities.

Canadian businesses – particularly small and midsize enterprises – need a reliable ecommerce delivery partner that allows them to succeed, grow and compete at a time when large, multinational delivery providers are fuelling the growth of huge global retailers. Canada Post, with its unrivalled network and reach, acts as an essential national equalizer, helping Canadian businesses compete with retail giants.

Preserving this important national infrastructure

Canada Post is built to serve the entire country and has the capability to succeed. The challenges facing the postal service today have put it at a critical juncture. Canada Post needs the flexibility to make significant changes to modernize and preserve the national postal service and continue to serve all Canadians how and where they want.

Leading change on the road ahead

Canada Post has been undergoing a major transformation to better compete. But with the sudden, post-pandemic acceleration in competition significantly impacting the business, the current situation will require a much broader approach. Canada Post is committed to leading the change that’s necessary to secure this essential service.

This national, publicly owned infrastructure has been there for Canadians at every step in our history. Any discussion regarding our future roadmap will require the continued engagement of the minister responsible for Canada Post, and the Government of Canada.

In the short term, we are continuing to find efficiencies that improve our competitiveness while not impacting service. We’re continuing to invest in the capacity that’s needed to serve a growing country. We’re also continuing to seek new sources of revenue connected to our core mission – delivering for Canadians.

In addition, we’re working collaboratively with our bargaining agents to achieve greater flexibility in the way we deliver. Our goal is to provide cost-effective, seven-day-a-week delivery that meets the current and future needs of Canadians and businesses. We’re already testing dynamic delivery models and other new services.

To address longer-term issues, we need to fully understand what kind of postal system Canadians want. We need to understand how it should operate financially and who is going to pay for it – users of the system, or taxpayers. This is an important discussion about a national institution that requires input from customers, key stakeholders, our bargaining agents, and Canadians. This conversation is already under way.

As we formalize our roadmap for change, we will do so with the following goal: provide a postal system that has the flexibility it needs to modernize and serve all Canadians, while ensuring the checks and balances that Canadians want are in place.