Executive summary
Canada Post proudly delivers to all. It’s not just our duty – it’s our history. We provide a critical national infrastructure, with a reach that touches every corner of the country. We’re a lifeline for communities and help Canadian businesses compete. But our decades-old foundation is crumbling – it’s holding us back in today’s hypercompetitive delivery market and threatening our future.
The Corporation’s long-standing mandate is to deliver to all Canadians – living in urban, rural and remote areas – and to stand on its own financially, based on revenue generated from its products and services, not taxpayer dollars. It operates on a user-pay model that’s meant to keep the postal service attuned to the evolving expectations of Canadians. To do so, Canada Post must be able to change as the needs of the country change. However, the Corporation is rapidly falling behind.
Outdated operating, regulatory and policy constraints are limiting our ability to adapt to the changing needs of the country. At the same time, letter mail continues to decline and competition has rapidly intensified in ecommerce delivery. As a result, the Corporation has posted years of large financial losses and is now at a crisis point in its history. Together, these challenges threaten our ability to serve the entire country and prevent us from keeping pace with the evolving needs of Canadians.
As this report demonstrates, Canada Post’s financial situation is unsustainable. We must make urgent changes to modernize and preserve this critical national infrastructure for all Canadians. The future of the national postal system is at risk. The status quo has brought the Corporation to the brink of insolvency and is clearly not a viable option.
Financial losses continue to mount
- The Corporation has posted seven consecutive years of significant losses.
- In 2024, Canada Post recorded a loss from operations of nearly $1.3 billion. The loss from operations excluded non-recurring gains and dividend income from the Corporation’s divestitures of SCI Group Inc. and Innovapost Inc. in the first half of the year.
- Since 2018, Canada Post’s cumulative losses from operations are more than $4.5 billion.
- Overall, Canada Post recorded a loss before tax of $841 million in 2024, compared to a loss before tax of $748 million in 2023. The loss before tax factors in the non-recurring gains and dividend income from the divestitures of SCI and Innovapost.
- Since 2018, Canada Post has lost more than $3.8 billion before taxes.
- The national strike by the Canadian Union of Postal Workers (CUPW) in the fourth quarter had a significant impact on the lines of business in 2024, with the largest impact on our Parcels business. Parcels revenue and volumes – which had already declined through the first three quarters – fell sharply for the full year, by 20.3 per cent and 19.9 per cent, respectively, compared to the previous year.
- Canada Post’s operating costs – on track to increase for the year prior to the strike – declined by 5.3 per cent in 2024 compared to the previous year, largely due to operations being shut down during the labour disruption.
- With revenue falling much more than costs during the strike, the Corporation estimates that the labour disruption contributed a net negative impact of $208 million toward Canada Post’s $841-million loss before tax.
- In 2024, labour and benefits represented approximately 65 per cent of total operating expenses.
- The company has continued to take action to control costs and look for additional efficiencies without impacting service. Our teams are always seeking new sources of revenue connected to our core responsibility – delivering for all Canadians.
Lasting impacts of the national strike
The 32-day national strike by CUPW in late 2024 was a challenging period for Canada Post, its employees and the millions of Canadians who rely on the postal service.
Canada Post put forward fair and reasonable proposals for a more flexible delivery model that would sustain the business, while increasing wages, enhancing leave entitlements, and protecting the defined benefit pension and job security provisions for current employees. While significant changes are needed to its collective agreements, the Corporation understood it would take time to achieve the necessary reforms and it proposed measured changes that largely impacted future employees.
However, the parties could not reach a resolution. After receiving direction from the Minister of Labour, the Canada Industrial Relations Board ordered Canada Post and CUPW-represented employees to resume operations on December 17, 2024. The strike significantly eroded customer trust and loyalty. Many customers who found other delivery providers have not yet returned to Canada Post – a financial impact that’s expected to last well into 2025 and beyond.
What’s at stake is much bigger than the relationship between Canada Post and its employees. It’s about preserving the long-standing relationship between Canada Post and the country it serves. As we saw during the strike, a large swath of the country still relies heavily on the postal service.
Canadians from coast to coast to coast were impacted. Small businesses, charities as well as rural, remote and Indigenous communities were particularly hit hard. Canada Post knows that it needs to earn back their trust. We must continue to evolve and become financially self-sustainable so they can always count on us – and never get left behind.
The Great Mail Decline continues
Letter mail, the long-standing foundation of the postal system, has been declining steadily for almost two decades. In 2006, the year Canada hit peak mail, we delivered almost 5.5 billion letters. In 2024, we delivered two billion letters, and that erosion will continue. Canadians are seeing this sharp decline in their mailboxes. Back in 2006, their households received an average of seven letters per week; today, it’s two per week.
This ongoing decline in letter mail volumes is significantly eroding an important source of revenue for Canada Post. A postal system built for 5.5 billion letters can’t survive on two billion letters.
The number of addresses grows each year...
... as letter mail per address declines
Find a data table for our address growth infographic and a data table for our letter mail decline infographic on our page Delivery reach and letter mail data.
As our mail revenue declines, delivery costs keep increasing. We deliver to more locations each year, with over 200,000 new addresses added annually. Since the peak mail year of 2006, the number of addresses we deliver to has risen by 3.3 million. This combination of delivering fewer letters to more addresses every year is unsustainable.
Serving our country’s growing need for parcel delivery
Our core business will always be delivering items to Canadians, but what we deliver changes over time. While mail remains important, parcel delivery is where the growth is, with the Canadian ecommerce market expected to double over the next decade.
To handle the continued growth in online shopping and better serve customers, we’ve made targeted, strategic investments in recent years. Our investments have included new sorting equipment, facility upgrades, digital platforms and new service offerings – while we’ve remained focused on our highest priority, employee safety.
However, Canada Post has quickly fallen behind over the last few years after competition in the parcel delivery market exploded during the pandemic-driven online shopping boom. The Corporation’s early success as an ecommerce delivery leader eclipsed the fact that it was doing so with an operating, regulatory and policy structure built for mail delivery.
The competition is now faster, flexible and focused on growth – pushing Canada Post to the sidelines as it continues to carry the weight of legacy restrictions and outdated operating parameters. As a result, our market share in parcel delivery has quickly eroded by around two thirds, from 62 per cent in 2019 to 24 per cent in 2024 (prior to the labour disruption).
Broader change is urgently needed
At this critical moment in our history, broader change is urgently needed to preserve and modernize the postal system. We need flexibility in our delivery model, collective agreements, and regulatory and policy framework to better serve Canadians and compete in today’s parcel delivery market. The end goal is a self-sustaining postal system that has the flexibility to adapt and serve all Canadians in every corner of the country, without burdening taxpayers.
An outdated postal system will affect all Canadians, but it will be felt most by those who need it most – small and midsize businesses as well as Canadians in rural and remote areas. We’re proud to be part of a Team Canada approach to supporting our economy and country. But we must modernize to ensure we’re there for all Canadians, today and in the future.
A flexible delivery model to serve Canada’s evolving needs
Canada Post’s operating structure was built for a bygone era of letter mail. The company’s current collective agreements with CUPW contain pages and pages of requirements and restrictions that were added decades ago as the company was focused on delivering a large and steady stream of mail.
While mail volumes are now a fraction of what they were, attempts at negotiating measured changes to the collective agreements have been extremely challenging. Today, these agreements significantly limit Canada Post’s ability to serve the dynamic needs and expectations of Canadians and businesses in today’s ecommerce market – including offering affordable evening and weekend parcel delivery.
To be clear, it’s our outdated delivery model and workplace rules – not our employees – that hold us back. Our people are the best in the delivery business and proud to serve Canadians. A modern postal system would help them better serve our country.
Canada Post must transform into a seven-days-a-week parcel business, that continues to deliver mail. To do so, the Corporation urgently needs more flexibility in its delivery model and collective agreements. Without these key pillars in place, the future of Canada Post and the meaningful jobs it provides are in jeopardy. We continue to work with our bargaining agents, particularly CUPW, to achieve greater flexibility in the way we deliver.
A modern regulatory and policy framework for a changing country
Canada Post’s dual mandate – to serve all Canadians and remain financially self-sustainable – requires a balance between the Corporation’s freedom to manage its operations and government oversight to ensure Canadians’ interests continue to be met.
However, since the Canada Post Corporation Act was implemented in 1981, successive governments have introduced policy and regulatory changes that have tipped the balance toward greater restrictions on the Corporation. This restrictive regulatory and policy framework is now outdated and stuck in the past, despite the ongoing decline of letter mail, changing demographics and growing competition in the parcel delivery business. The balance required for Canada Post to meet its mandate no longer exists.
To create more autonomy and flexibility, and meet the current and future needs of the country in a financially sustainable manner, Canada Post has put forward the following recommendations at the Industrial Inquiry Commission:
- Initiate a timely and thorough consultation and review of the Canadian Postal Service Charter, with a focus on updating service standards, delivery frequency and post office requirements.
- Update the process for calculating and implementing regular letter mail price increases within a shorter timeline, while ensuring proper consultation, government oversight and advance notice for customers.
- Update or replace the moratorium on rural post office closures and conversions with a modern policy framework that continues to protect rural service.
- End the moratorium on community mailbox conversions, which protects a costly, premium service for less than 25 per cent of Canadian addresses in established urban neighbourhoods. More than 70 per cent of addresses already receive delivery to a centralized location. For residential customers with functional limitations, Canada Post’s delivery accommodation program offers a variety of accommodations to help them access packages and mail.
Why Canada needs a postal service
Canada Post is an essential lifeline for Canadians, businesses, organizations and communities from coast to coast to coast. We are the only delivery company with the network, people and commitment to serve all 17.6 million addresses across our vast country.
A wholly Canadian, publicly owned delivery company is even more essential in a period when the Canadian economy is threatened by tariffs. Our national reach is critical to small businesses at a time when contract-labour delivery companies look to serve global retailers and focus on urban centres. As Canadians increasingly look to support homegrown businesses, we’re here to help. Our country depends on Canada Post because it delivers everywhere, not just where it would be most profitable. Our services are vital for many Canadians, such as:
- Small and midsize businesses: Canada Post is a more affordable option with a truly national reach. We enable them to compete in a market increasingly dominated by multinational ecommerce giants.
- Canadians in rural, remote and Indigenous communities: Canada Post is often their only delivery option, connecting them to the rest of the country.
- Charities big and small: The mail service provides an important vehicle to connect directly with supporters and solicit vital donations.
- Canadians in urban and suburban communities: Canada Post provides a trusted delivery service that keeps them connected to government services, friends, family and businesses right across the country. We need a strong urban presence to help fund the less profitable areas where we’re crucial to those communities.
Our commitment to leading necessary change
We’re built to serve all Canadians, no matter where they live. However, the foundation of the postal system is crumbling. Urgent changes are needed to Canada Post’s delivery model, collective agreements, and its regulatory and policy framework to protect its role as a vital national infrastructure.
The financial and structural challenges threatening Canada Post also pose a significant threat to communities across our country. Canada Post needs greater flexibility and autonomy in how it operates to continue to serve the entire country, understanding that the checks and balances Canadians want are also necessary.
Important discussions about the future of Canada Post have already begun and will continue in the months ahead. As we work with the Government of Canada, our bargaining agents and all Canadians, we are committed to leading the change that’s necessary to keep pace with the evolving needs of the country and return to financial sustainability.