Tag Archives: Coronavirus

J&J eyes one billion doses of potential COVID-19 shot in 2021, weighs challenge trials

By Francesco Guarascio

BRUSSELS (Reuters) – Johnson & Johnson could produce 1 billion doses of its potential COVID-19 vaccine next year if it proves successful and would consider injecting healthy volunteers with the novel coronavirus if there are not enough patients for final trials, a company executive said.

J&J kicked off in July early-stage human safety trials for its potential COVID-19 vaccine after releasing details of a study in monkeys that showed its best-performing candidate offered strong protection in a single dose.

It is developing the vaccine in collaboration with its Belgian subsidiary, Janssen.

Large-scale trials are set to start by the beginning of October and J&J aims to have results on the vaccine’s efficacy between the end of this year and mid-2021, Johan Van Hoof, head of vaccines at Janssen, told Reuters on Tuesday in a telephone interview.

Earlier on Tuesday, President Vladimir Putin said Russia had become the first country to grant regulatory approval to a COVID-19 vaccine after less than two months of human testing, and before large-scale trials had been conducted.

Van Hoof said that production of the vaccine had already begun despite the financial risks involved, to make sure it would be available as soon as possible should it prove effective against the new coronavirus.

Several million doses will be ready by the beginning of 2021, with a total capacity of 1 billion shots by the end of the year, he said. He added that the company was likely to favor a single-jab approach, although a final decision on whether a booster would be needed had not yet been made.

ETHICAL ISSUES

Outcomes of large-scale, or Phase III, trials will depend on the incidence of infections, Van Hoof said, with faster results expected with higher virus transmission.

That is why J&J is likely to conduct those trials in the United States and Latin America, the world’s regions currently with the highest number of cases.

If infections drop significantly, J&J is also considering so-called challenge trials, in which volunteers are infected with the virus so that a vaccine candidate can be tested on them.

“We are looking into that possibility,” Van Hoof said, noting though that such trials posed ethical issues that needed to be resolved before they could be conducted. For instance, an effective therapy against the disease should be available to minimize risks for volunteers exposed to the virus.

In May British drugmaker AstraZeneca, which is developing a leading coronavirus vaccine with Oxford University, said it was too early to deliberately expose trial participants to the pathogen, but that may become an option if ongoing tests hit a snag.

Van Hoof said that preparations to stock the virus for possible challenge trials were already underway and J&J was part of ongoing discussions with universities and other bodies involved in these projects.

“We find it a very interesting idea,” he said, adding however, that setting up facilities for such trials would perhaps take longer than testing vaccines on people who are already infected in the community – as long as transmission remained relatively high.

(Reporting by Francesco Guarascio; editing by Emelia Sithole-Matarise)

U.S. health chief, visiting Taiwan, attacks China’s pandemic response

By Yimou Lee

TAIPEI (Reuters) – U.S. Health Secretary Alex Azar attacked China’s response to the coronavirus pandemic on Tuesday and said that if such an outbreak had emerged in Taiwan or the United States it could have been “snuffed out easily”.

The Trump administration has repeatedly criticized Beijing for trying to cover up the virus outbreak, first identified in the central Chinese city of Wuhan late last year, and prevaricating on information sharing. China angrily denies the accusations.

“The Chinese Communist Party had the chance to warn the world and work with the world on battling the virus. But they chose not to, and the costs of that choice mount higher every day,” Azar said in Taipei, capital of self-ruled Taiwan, an island China claims as its own.

As the virus emerged, China did not live up to its “binding” international obligations in a betrayal of the cooperative spirit needed for global health, he added, wearing a face mask as he has done for all his public events in Taiwan.

“I believe it is no exaggeration to say that if this virus had emerged in a place like Taiwan or the United States, it might have been snuffed out easily: rapidly reported to public health authorities, who would have shared what they knew with health professionals and with the general public,” Azar said.

“Instead, Beijing appears to have resisted information sharing, muzzling doctors who spoke out and hobbling the world’s ability to respond.”

The United States has the highest number of coronavirus infections and deaths in the world and President Donald Trump has come under scathing attack from critics at home for not taking what he calls the “China virus” seriously enough.

Taiwan has been praised by health experts for its early and effective steps to control the outbreak, with only 480 infections, including seven deaths.

Azar arrived in Taiwan on Sunday as the highest-level U.S. official to visit in four decades, a trip condemned by China.

China considers Taiwan a breakaway province and has vowed to bring it under its rule, by force if necessary.

Chinese fighter jets on Monday briefly crossed the median line of the sensitive Taiwan Strait, and were tracked by Taiwanese anti-aircraft missiles, part of what Taipei sees as a pattern of harassment by Beijing.

Washington broke off official ties with Taipei in 1979 in favor of Beijing but is still Taiwan’s biggest arms supplier. The Trump administration has made strengthening its support for the democratic island a priority as relations with China sour over issues including human rights, the pandemic, Hong Kong and trade.

Azar said the world should recognize Taiwan’s health accomplishments and not try to push it out, pointing to Taiwan’s exclusion from the World Health Organization due to Chinese objections.

“This behavior is in keeping with Beijing’s approach to WHO and other international organisations. The influence of the PRC (People’s Republic of China) far outweighs its investment in this public health institution – and it uses influence not to advance public health objectives, but its own narrow political interests.”

Both China and the WHO say Taiwan has been provided with the help it needs during the pandemic, which Taiwan disputes.

(Reporting by Yimou Lee; Writing by Ben Blanchard; Editing by Lincoln Feast and Nick Macfie)

Some U.S. colleges stick to in-person reopening in pandemic despite doubts, pushback

By Jan Wolfe and Catherine Koppel

(Reuters) – Many U.S. universities are revamping campuses to resume in-person classes despite COVID-19, requiring students to be tested, wear masks and socially distance, but some college town residents and critics say schools are putting profits before public safety.

Tulane University, a private college in New Orleans, plans to reopen on Aug. 19 to as many as 13,000 students. Before students move in to dormitories, they must report to an “Arrival Center” at a city hotel “where they will be guided through two days consisting of COVID-19 testing and orientation sessions” according to Tulane’s published guidance.

Maintenance workers at Tulane and other colleges are fitting auditoriums and classrooms with signage for social distancing. Students are being asked to wear masks, and at Tulane, those who host parties or gatherings with more than 15 people could face expulsion, the college said.

Rice University in Houston, Texas has contracted for 60,000 COVID-19 tests, and has bought temporary structures and open-sided tents for classes and meeting space.

Cornell University in Ithaca, New York, will require that students enter into a “behavioral compact” aimed at stemming the spread of the novel coronavirus, which has killed more than 162,000 people in the United States and infected over five million.

Tulane president Michael Fitts said enrollment has been largely unaffected by the pandemic.

“The interest in sort of the classic, undergraduate, on-ground experience has never been stronger,” he said.

While college presidents like Fitts say public health is paramount, some industry experts point to schools’ powerful financial motivation to be on campus and in residences because of auxiliary revenue from services such as dining halls, bookstores, and vending machines.

“I don’t think it’s only about money – but it leads with money,” higher education researcher Jeff Selingo said. “Their entire business model, including their financial stability, is predicated on bringing people together in close proximity.”

HYBRIDS

Some colleges, however, are lowering the number of people allowed on campus to reduce risk of contagion, offering hybrids of in-person and online learning or altering the academic year’s structure.

When the novel coronavirus shook the world back in March, U.S. colleges almost uniformly shut down, dormitories emptied and classes moved online.

“What we are seeing this fall is a million different scenarios,” Selingo said.

In late May, about two-thirds of U.S. colleges and universities said they were planning to resume in-person instruction in the fall, according to data compiled by the Chronicle of Higher Education. That number declined to about 50 percent as of late July.

Johns Hopkins University, a research institution in Baltimore, Maryland, is one of several schools that abandoned plans to have students return to campus.

“Unfortunately, the pandemic is worsening,” Johns Hopkins President Ronald Daniels said in an Aug. 6 letter. “We have concluded that returning in person would pose unacceptable risks.”

Cornell, which has about 23,000 students, has said that in-person classes actually will result in fewer coronavirus cases than a virtual semester.

Thousands of students live off-campus, and many have indicated they will return to Ithaca even if classes are online, Cornell president Martha Pollack said in an Aug. 5 letter.

Resuming campus life makes it easier to monitor and test those students, wrote Pollack, who declined to be interviewed for this article.

Students, for example, will have to fill out a daily online health assessment as part of a behavioral compact and will face penalties, including suspension, for misleading the school.

Still, Cornell’s plan has drawn objections from some Ithaca residents. Ri Bornstein, an artist and administrative assistant, said townspeople have kept the virus under control by acting responsibly and that some students who already have returned to campus are not.

“Cornell is saying people will act appropriately, but then I look outside and see frat parties,” Bornstein said.

“They are enacting the plan that’s about the most possible profit for them,” he asserted, saying Cornell’s modeling seems questionable and self-serving.

Pollack’s letter said that the reopening plan was driven by science, not financial considerations.

Pollack said that while there could be more than a thousand coronavirus cases during the coming semester, online learning would result in several thousand infections, according to statistical modeling done by Cornell data scientist Peter Frazier.

“As we all have learned, there are no perfect solutions to this deeply imperfect situation,” she said. “All we can do is strive our hardest for the best solutions we can find.”

(Reporting by Jan Wolfe and Catherine Koppel; editing by Noeleen Walder and Grant McCool)

Mexico to conduct late-stage trials for China, US COVID-19 vaccines

MEXICO CITY (Reuters) – Mexico will conduct late-stage clinical trials for COVID-19 vaccines in development by Johnson & Johnson and two Chinese companies, the foreign ministry said on Tuesday.

Large-scale, phase three human testing for the J&J unit Janssen Pharmaceuticals’ candidate could start in the second half of September, the company has previously said.

Mexico will also help test candidates for Chinese companies CanSino Biologics Inc and Walvax Biotechnology Co Ltd, the ministry said in a presentation at a news conference.

More than 150 vaccines are being developed and tested around the world to stop the COVID-19 pandemic, with 25 in human clinical trials, according to the World Health Organization.

Russia is the first country to approve a COVID-19 vaccine, which it named ‘Sputnik V’ for foreign markets, an official said on Tuesday.

Johnson & Johnson kicked off U.S. human safety trials in July for its COVID-19 vaccine after releasing details of a study in monkeys that showed its best-performing vaccine candidate offered strong protection in a single dose.

Walvax’s experimental vaccine is currently under early testing at a Chinese military research institute.

CanSino Biologics’ vaccine candidate is already in clinical trials. The company is also collaborating with Canada’s National Research Council to “pave the way” for future trials in Canada, the research council in May.

Mexico has lobbied in world forums including at the G20 group of nations and the United Nations to secure equitable access for an eventual vaccine.

Latin America’s second largest economy has suffered more than 50,000 deaths from COVID-19, according to official data, making it the third country with most deaths globally.

It ranks 13th adjusted for deaths per capita, according to Johns Hopkins University School of Medicine.

(Reporting by Frank Jack Daniel; Editing by Chizu Nomiyama and Alistair Bell)

Global coronavirus cases hit 20 million: Reuters tally

By Gayle Issa

(Reuters) – Global coronavirus cases pushed past 20 million on Monday, according to a Reuters tally, with the United States, Brazil and India accounting for more than half of all known infections.

The respiratory disease has infected at least four times the average number of people struck down with severe influenza illnesses annually, according to the World Health Organization.

The death toll from COVID-19, meanwhile, at more than 728,000 has outpaced the upper range of annual deaths from the flu.

The Reuters tally, which is based on government reports, shows the disease is accelerating. It took almost six months to reach 10 million cases after the first infection was reported in Wuhan, China, in early January. It took just 43 days to double that tally to 20 million.

Experts believe the official data likely under counts both infections and deaths, particularly in countries with limited testing capacity.

The United States is responsible for around 5 million cases, Brazil 3 million and India 2 million. Russia and South Africa round out the top ten.

The pandemic is accelerating fastest in Latin America which accounts for almost 28% of the world’s cases and more than 30% of deaths, according to the Reuters tally.

With the first wave of the virus yet to peak in some countries and a resurgence of cases in others, governments are still divided in their responses. Some countries are reintroducing strict public health measures, while others continue to relax restrictions.

Health experts expect dilemmas about how to proceed with school, work and social life to last – and restrictions to fluctuate – until a vaccine is available.

The vaccine race has more than 150 candidates being developed and tested around the world with 25 in human clinical trials, according to the World Health Organization.

In the United States, children began returning to their classrooms last week, even as controversy over school safety swirled.

Britain has added both Spain and Belgium to a list of countries from which returning travelers must quarantine at home for 14 days because of fresh upticks in some European locations.

In Asia, China continues to squash surges using strict, local lockdowns, bringing its daily numbers down into the low double digits on the mainland.

Australia has introduced a strict lockdown and night curfew in the city of Melbourne, aiming to stifle an outbreak there. Neighboring New Zealand, where life has largely returned to normal, on the weekend recorded 100 days with no new cases of local transmission.

(Reporting by Gayle Issa; editing by Jane Wardell)

Federal Reserve announces post-stress test capital ratios for large banks

By Pete Schroeder

WASHINGTON (Reuters) – The U.S. Federal Reserve announced on Monday how much each large bank that underwent its 2020 stress tests will have to hold in additional capital.

The results mark the first time the Fed has given out custom capital requirements for each bank under its new “stress capital buffer,” and takes effect on Oct. 1. Goldman Sachs and Morgan Stanley were ordered to hold the most capital of the 34 firms tested, with ratios of 13.7% and 13.4% respectively.

The custom capital requirements follow stress test results released in June, which found that banks would weather heavy capital losses should the economic fallout from the coronavirus pandemic drag on or worsen. The Fed ordered banks to cap dividend payments and bar share repurchases until at least the fourth quarter to ensure they have sufficient cushions.

The new capital ratio combines the minimum capital requirements of 4.5% and the new “stress capital buffer,” which is determined by how each bank fared under a hypothetical severe economic downturn. That buffer is at least 2.5%, but was highest for Deutsche Bank’s U.S. operations at 7.8%.

The nation’s largest banks also face an additional capital surcharge for their predominant role in the financial system, ranging from 1% to 3.5% for JP Morgan Chase, the nation’s biggest bank.

The Fed also announced that it had reaffirmed the stress test results for five banks that requested reconsideration: BMO Financial Corp., Capital One Financial Corp, Citizens Financial Group Inc, Goldman Sachs and Regions Financial Corp. The Fed said the additional review found its stress test models worked as intended and there were no errors.

(Reporting by Pete Schroeder; Editing by Chizu Nomiyama and Jonathan Oatis)

China sends fighter jets as U.S. health chief visits Taiwan

By Yimou Lee and Ben Blanchard

TAIPEI (Reuters) – Chinese air force jets briefly crossed the mid-line of the Taiwan Strait on Monday and were tracked by Taiwanese missiles, Taiwan’s government said, as U.S. health chief Alex Azar visited the island to offer President Donald Trump’s support.

Azar arrived in Taiwan on Sunday, the highest-level U.S. official to visit in four decades.

China, which claims the island as its own, condemned the visit which comes after a period of sharply deteriorating relations between China and the United States.

China, which had promised unspecified retaliation to the trip, flew J-11 and J-10 fighter aircraft briefly onto Taiwan’s side of the sensitive and narrow strait that separates it from its giant neighbor, at around 9 am (0100 GMT), shortly before Azar met Taiwan President Tsai Ing-wen, Taiwan’s air force said.

The aircraft were tracked by land-based Taiwanese anti-aircraft missiles and were “driven out” by patrolling Taiwanese aircraft, the air force said in a statement released by the defense ministry.

China’s defense ministry did not immediately comment.

A senior Taiwan official familiar with the government’s security planning told Reuters that China was obviously “targeting” Azar’s visit with a “very risky” move given the Chinese jets were in range of Taiwan’s missiles.

The incursion was only the third time since 2016 that Taiwan has said Chinese jets had crossed the strait’s median line.

The Trump administration has made strengthening its support for the democratic island a priority, amid deteriorating relations between Washington and Beijing, and has boosted arms sales.

“It’s a true honor to be here to convey a message of strong support and friendship from President Trump to Taiwan,” Azar told Tsai in the Presidential Office, standing in front of two Taiwanese flags.

Washington broke off official ties with Taipei in 1979 in favor of Beijing.

‘HUGE STEP’

Azar is visiting to strengthen economic and public-health cooperation with Taiwan and support its international role in fighting the novel coronavirus.

“Taiwan’s response to COVID-19 has been among the most successful in the world, and that is a tribute to the open, transparent, democratic nature of Taiwan’s society and culture,” he told Tsai.

Taiwan’s early and effective steps to fight the disease have kept its case numbers far lower than those of its neighbors, with 480 infections and seven deaths. Most cases have been imported.

The United States, which has had more coronavirus cases and deaths than any other country, has repeatedly clashed with China over the pandemic, accusing Beijing of lacking transparency.

Tsai told Azar his visit represented “a huge step forward in anti-pandemic collaborations between our countries”, mentioning areas of cooperation including vaccine and drug research and production.

Taiwan has been particularly grateful for U.S. support to permit its attendance at the World Health Organization’s decision-making body the World Health Assembly (WHA), and to allow it greater access to the organisation.

Taiwan is not a member of the WHO due to China’s objections. China considers Taiwan a Chinese province.

“I’d like to reiterate that political considerations should never take precedence over the rights to health. The decision to bar Taiwan from participating in the WHA is a violation of the universal rights to health,” Tsai said.

Azar later told reporters that at Trump’s direction, he and Secretary of State Mike Pompeo had sought to restore Taiwan’s status as an observer at the WHA.

“But the Chinese Communist Party and the World Health Organization have prevented that. This has been one of the major frustrations that the Trump administration has had with the World Health Organization and its inability to reform.”

(Reporting by Ben Blanchard and Yimou Lee; Editing by Lincoln Feast, Robert Birsel)

Trump signs coronavirus relief orders after talks with Congress break down

By Jeff Mason

BEDMINSTER, N.J. (Reuters) – President Donald Trump signed executive orders on Saturday partly restoring enhanced unemployment payments to the tens of millions of Americans who lost jobs in the coronavirus pandemic, as the United States marked a grim milestone of 5 million cases.

Negotiations broke down this week between the White House and top Democrats in Congress over how best to help Americans cope with the heavy human and economic toll of the crisis, which has killed more than 160,000 people across the country.

Trump said the orders would provide an extra $400 per week in unemployment payments, less than the $600 per week passed earlier in the crisis. Some of the measures were likely to face legal challenges, as the U.S. Constitution gives Congress authority over federal spending.

“This is the money they need, this is the money they want, this gives them an incentive to go back to work,” the Republican president said of the lower payments. He said 25% of it would be paid by states, whose budgets have been hard hit by the crisis.

Republicans have argued that higher payments were a disincentive for unemployed Americans to try to return to work, though economists, including Federal Reserve officials, disputed that assertion.

Trump’s move to take relief measures out of the hands of Congress drew immediate criticism from some Democrats.

“Donald Trump is trying to distract from his failure to extend the $600 federal boost for 30 million unemployed workers by issuing illegal executive orders,” said Senator Ron Wyden, the top Democrat on the Senate Finance Committee. “This scheme is a classic Donald Trump con: playacting at leadership while robbing people of the support they desperately need.”

The Democratic-majority House of Representatives passed a coronavirus support package in May which the Republican-led Senate ignored.

Democratic presidential candidate Joe Biden called the orders a “series of half-baked measures” and accused Trump of putting Social Security “at grave risk” by delaying the collection of payroll taxes that pay for the program.

Trump also said he was suspending collection of payroll taxes, which pay for Social Security and other federal programs, an idea that he has repeatedly raised but has been rejected by both parties in Congress. He said the suspension would apply to people making less than $100,000 per year.

His orders would also stop evictions from rental housing that has federal financial backing and extend zero percent interest on federally financed student loans.

Trump initially played down the disease’s threat and has drawn criticism for inconsistent messages on public health steps such as social distancing and masks.

He spoke to reporters on Saturday at his New Jersey golf club, in a room that featured a crowd of cheering supporters.

FAR APART

Nearly two weeks of talks between White House officials and congressional Democrats ended on Friday with the two sides still about $2 trillion apart.

House Speaker Nancy Pelosi had pushed to extend the enhanced unemployment payments, which expired at the end of July, at the previous rate of $600 as well as to provide more financial support for city and state governments battered by the crisis.

Pelosi and Senate Minority Leader Chuck Schumer on Friday offered to reduce the $3.4 trillion coronavirus aid package that the House passed in May by nearly a third if Republicans would agree to more than double their $1 trillion counteroffer.

White House negotiators Treasury Secretary Steven Mnuchin and Chief of Staff Mark Meadows rejected the offer.

The $1 trillion package that Senate Majority Leader Mitch McConnell unveiled late last month ran into immediate opposition from his own party, with as many as 20 of the Senate’s 53 Republicans expected to oppose it.

Trump did not rule out a return to negotiations with Congress.

“I’m not saying they’re not going to come back and negotiate,” he said on Saturday. “Hopefully, we can do something with them at a later date.”

Democrats have already warned that such executive orders are legally dubious and would likely be challenged in court, but a court fight could take months.

Trump has managed to sidestep Congress on spending before, declaring a national emergency on the U.S.-Mexico border to shift billions of dollars from the defense budget to pay for a wall he promised during his 2016 election campaign.

Congress passed legislation to stop him, but there were too few votes in the Republican-controlled Senate to override his veto – a scenario that would likely play out again with less than 90 days to go before the Nov. 3 presidential election.

(Reporting by Jeff Mason, additional reporting by Raphael Satter, Brad Brooks, and Rich McKay; Writing by Scott Malone; Editing by Diane Craft, Daniel Wallis, Jonathan Oatis and Sonya Hepinstall)

Uber rides take COVID-19 hit but food-delivery business doubles

By Tina Bellon and Akanksha Rana

(Reuters) – Home-bound customers of Uber Technologies Inc. more than doubled their orders from the company’s food-delivery service in the second quarter but demand for ride-hailing trips only marginally recovered from pandemic rock-bottom.

The company said that despite those larger challenges it is sticking to its goal of being profitable on an adjusted basis before the end of 2021 thanks to stringent cost-cutting measures and a strong balance sheet. Uber recorded an adjusted loss in earnings before interest, taxes, depreciation and amortization of $837 million in the second quarter.

Shares were down 2.9% at $33.72 in after-hours trading.

Ride-hailing trips, in the past responsible for nearly two-thirds of Uber’s revenue, increased 5 percentage points from their low in April, but gross bookings remained down 75% from last year.

Uber’s chief executive officer, Dara Khosrowshahi, told analysts on a conference call on Thursday that rides recovery depended on the ability of different countries to contain the virus, with the recovery so far led by Asia, excluding India.

In Hong Kong and New Zealand, ride bookings at times exceeded pre-COVID-19 levels, while trip requests in Germany, France and Spain have improved to just a 35% decline from a year ago.

“Our global geographic footprint remains a huge advantage,” Khosrowshahi said.

The company on Thursday posted a $1.8 billion net loss from April through June, including charges related to laying off 23% of its global workforce during a period when infections of the novel coronavirus continued to spread in the United States, Uber’s largest market.

The number of active platform users across the 69 countries in which Uber operates nearly halved year-over-year, from 99 million to 55 million.

Uber’s second-quarter revenue fell 29% to $2.24 billion from the year prior, beating analysts’ average estimate of $2.18 billion, according to IBES data from Refinitiv.

Revenue at Uber Eats doubled to $1.2 billion, boosted by greater demand for delivery as Americans largely continue to stay home. Uber last month expanded its delivery reach by announcing the acquisition of Postmates Inc for $2.65 billion to expand the business of supplying everyday goods.

Uber’s ride-hailing segment remained battered by the coronavirus crisis, with revenue from the United States and Canada, its largest combined market, declining to $1.25 billion. Nevertheless, ride-hailing was the only segment generating an adjusted EBITDA profit, of $50 million.

Uber said fewer U.S. ride-hail drivers were returning to the platform compared with other countries. Uber faces several legal challenges over the status of its drivers in the United States, with California and Massachusetts suing the company over the alleged mis-classification of drivers as independent contractors.

Uber Eats, whose gross bookings more than doubled, narrowed losses, recording a $232 million adjusted EBITDA loss in the second quarter. Uber’s CFO, Nelson Chai, said the company expects third-quarter losses to be roughly the same.

He also told analysts that Uber’s food-delivery business would be profitable in the vast majority of countries in which it operates within a couple years.

Uber in recent months has closed Eats operations in eight smaller markets, including in Eastern Europe and the Middle East. It also cut losses from its Eats business in India, where it sold its food-ordering business to a local competitor in exchange for a stake in the company.

Uber Eats was also gaining traction in the suburbs, including the outer boroughs of New York City, where the food delivery service is now the market leader, the company said.

Uber executives said cost-cutting was helping to improve margins, along with better route planning and more restaurants relying on its delivery couriers.

(Reporting by Tina Bellon in New York and Akanksha Rana in Bangalore; Editing by Peter Henderson and Matthew Lewis)

New U.S. Postal Service chief warns of ‘dire’ finances as quarterly loss narrows

By David Shepardson

WASHINGTON (Reuters) – The head of the U.S. Postal Service (USPS) on Friday said the agency faces a “dire” financial position even as it posted a slightly narrower third-quarter loss amid soaring package demand during the coronavirus pandemic.

Postmaster General Louis DeJoy said USPS has a “broken business model” and is in need of organizational changes. “Without dramatic change, there is no end in sight and we face an impending liquidity crisis,” DeJoy said.

USPS said quarterly revenue rose to $17.6 billion, up $547 million. The quarterly net loss shrank to $2.2 billion from $2.3 billion in the same quarter last year.

First-class mail volume declined by 1.1 billion pieces, or 8.4%. Shipping and packages revenue increased by $2.9 billion, or 53.6%, on a volume increase of 708 million pieces, up 49.9%.

Democrats Thursday called on DeJoy to reverse changes that they say are resulting in delayed mail.

“We believe these changes, made during the middle of a once-in-a-century pandemic, now threaten the timely delivery of mail—including medicines for seniors, paychecks for workers, and absentee ballots for voters—that is essential to millions of Americans,” wrote House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer.

Voting by mail is expected to increase dramatically this fall amid the coronavirus pandemic. Trump has claimed without evidence that absentee voting leads to rampant fraud.

“We are not slowing down election mail or any other mail,” DeJoy, a Trump supporter, said Friday.

The Postal Service has faced financial woes with the rise of email and social media, and a measure passed in 2006 requiring it to pre-fund 75 years of retiree health benefits over the span of 10 years at a cost of more than $100 billion.

DeJoy said the Postal Service is eliminating inefficiencies, including “unnecessary overtime.” The Postal Service has lost $80 billion since 2007.

(Reporting by David Shepardson; Editing by Nick Zieminski)