Poste Italiane aims to capitalize on the e-commerce wave to boost parcel delivery

(Corrects third paragraph to state that for the first time in 10 years, growth in parcel revenue outweighed decline in letter volume)

MILAN, March 20 (Reuters) – Poste Italiane aims to more than double the number of parcels delivered by 2022, the head of its Mail and Parcel (M&P) division said. At the same time, the former postal monopoly continues its restructuring.

The group, which in addition to M&P now includes insurance and finance divisions and a digital payments unit, has seen mail volumes decline since at least 2008.

However, Poste recorded an increase in parcel revenue in 2018, which offset the decline in letter volume for the first time in 10 years, showing that the restructuring is starting to pay off, it said.

“Our target is to deliver 100 million parcels in 2022, up from 45 million delivered by our employees last year,” Massimo Rosini, head of M&P, told investors in London.

The group wants to increase its share of the e-commerce parcel delivery market from 33 percent in 2018 to 40 percent by 2022.

E-commerce is expected to grow rapidly in Italy as the country catches up with other European countries, such as the UK, where online shopping is much more common.

To compete with e-commerce giant Amazon, which offers its Prime delivery service in major Italian cities, Poste plans to fully implement a shared delivery system introduced last year and is developing an alternative network of delivery points.

Last year, the Post Office signed an agreement with trade unions under which parcel deliveries were to take place also on weekends, and employees were to deliver both parcels and letters to customers, while reducing the frequency of letter deliveries.

Rosini said revenue from the M&P division is expected to remain almost stable this year at around 3.5 billion euros, which would be around a third of Poste’s total revenue of 11 billion euros expected this year.

Poste’s CEO said on Tuesday the group is exploring the possibility of deliveries using drones and autonomous vehicles to attract more customers.

(Reporting by Francesca Landini, editing by Edmund Blair)