This discussion paper provides quantitative forecasts of letter volumes up to 2035, aiming to discuss the impact on universal service and the potential need for adapting USO requirements. Methodologically, existing forecasts and academic literature was researched and evaluated. On that basis, a parametric, Excel-based model for the German letter market was developed. This model incorporates economic growth, price effects and digital substitution. The validity of its assumptions was confirmed through discussions with market participants and the Federal Network Agency.
The model forecasts domestic letter volumes (without packages in the letter stream, magazines and newspapers) up to 2035 based on the base year 2023 and the selected influencing parameters. Two scenarios are considered: in the 'fast' scenario, volumes could fall by around 70% by 2035 compared to 2023; in the 'slow' scenario, by 50%. The regional distribution of volumes exhibits a wide variation in the number of letters delivered per km² between Germany’s Federal States. Depending on the scenario, we expect that, by 2030, 88 to 91% of the federal territory will receive fewer letters per square kilometre than the federal average in 2023.
Assuming there is no combined delivery and only domestic letters, if the delivery time targets remain constant at E+3/E+4, the weekly delivery frequency would have to be reduced to 3.3 days (slow scenario) or 2.6 days (fast scenario) for constant average costs in 2030. Further reductions would be necessary by 2035, which would no longer be feasible with the current delivery time targets. In order to maintain these targets, prices would have to rise in real terms. In practice, however, Deutsche Post delivers letters jointly with other products such as parcels, goods and international shipments. The joint delivery, alongside the introduction of A/B delivery, enable it to limit the increase in costs and thus reduce the pressure to adjust delivery time targets.
