Siemens Dematic announced today at the National Postal Forum the U.S. Postal Service has awarded the company a $127M fixed price contract for the Automated Tray Handling System (ATHS-100), an enhancement to the Automated Flats Sorting Machine (AFSM-100) program. The base contract (Phase I) will consist of 350 systems installed at 137 sites around the country with production deployment beginning in October 2004.

The ATHS-100 program is an enhancement to the highly successful implementation of 537 AFSM-100 systems that were designed, built and installed by Siemens Dematic and Northrop Grumman Corporation's Electronic Systems. The ATHS-100 program will greatly improve flat mail sorting operations and productivity by automatically exchanging full mail trays with empty ones, applying a label on the outbound trays, sweeping the AFSM-100 full trays after operation and re-loading empty trays.

"As an addition to our AFSM-100, the ATHS-100 is another major step toward improved productivity in the flats processing environment," said Gary Burns, Siemens Dematic Vice President of Government, Postal and Parcel Operations.  "This system represents the successful collaborative efforts of the U.S.P.S. and Siemens and their commitment to improving productivity in mail processing facilities."

ATHS-100 technology provides a marked improvement in flat mail sorting efficiency including decreased downtime between sort plans, faster tray exchanges resulting in less recirculation of mail, more robust system information, tremendous labor savings and subsequent cost savings over the life of the product. Through automation, the ATHS-100 makes future enhancements possible such as intelligent mail and tray tracking, optimized tray management, and eventually flat mail sequencing.

The U.S.P.S. has the option to buy 184 additional systems as part of Phase II of the ATHS-100 contract.

Siemens Dematic designed and tested two systems that are currently in operation at the Palatine, IL, Processing and Distribution Center. The company will provide additional program management, engineering, and installation services from its headquarters in Grand Rapids, MI. The ATHS-100 will be manufactured in Grand Rapids using existing capacity.

Siemens Dematic, a premier supplier of material handling and automation systems to the U.S.P.S., is currently working on new initiatives such as Network Integration and Alignment (NIA) and Delivery Point Packaging (DPP).

About Siemens Dematic

Siemens Dematic Material Handling Automation is one of Siemens' operating companies in the United States. The company, with its world headquarters in Grand Rapids, Michigan, designs and manufactures integrated material handling solutions for manufacturing, distribution and warehousing, automotive, parcel, freight, postal, air cargo and baggage handling industries. Siemens Dematic Material Handling Automation and its global affiliate, Siemens Dematic AG, supply a wide range of solutions, from individual products and systems to complete turnkey facilities as a general contractor. In addition to Material Handling, Siemens Dematic includes two other businesses: Postal Automation and Electronic Assembly Systems. The company, with approximately 11,000 employees worldwide, has a business volume of around $3 billion.

USPS TRANSFORMATION PLAN EXCERPT:
APPENDIX M — Efficiency-Based Strategies: Operational efficiencies keep costs down, which directly benefits customers. Major mailers have cited cost control as one of the major initiatives that they would like to see included in the near-term transformation effort. Postal Service operations costs are significant.
Substrategy 3: Deploy automatic tray handling system
Description: Automatic Tray Handling System (ATHS) for the AFSM 100 would replace the takeaway conveyors on the original AFSM 100 with state-of-the-art fixed mechanization that would do the following automatically:

1) load the machine’s 120 bins with empty tubs;
2) as individual tubs fill up, remove them, immediately insert an empty replacement into the vacated bin, and send the full tubs down a takeaway conveyor to the end of the machine;
3) label each full tub using information provided by the sorter’s control system, and
4) read and validate the label entries against the source information.

Trends / Supporting Data: It is expected that not all AFSM 100s will be modified with ATHS. Only those machines which have sufficient runtime will be modified.

Benefits: It is expected that ATHS will reduce the sweep personnel assigned to an AFSM 100 team from two employees to one employee. MilestonesPrototype testing is expected in 2002.

Substrategy 4: Deploy semiautomatic tray take-away mechanism on the FSM 1000
Description: A system similar to the ATHS is planned for the FSM 1000. The Semiautomatic Tray Take-Away Mechanism (SATTAM) will remove full trays from the tray rack of the FSM 1000 and place them onto the machine’s take-away belt. This mechanism will also move an empty tray into the place of the full tray to begin receiving flat mail.
Benefits: It is expected that this system will reduce the staffing of sweepers by one per FSM 1000. MilestonesPrototype testing is expected in late 2003.

SOURCE: USPS TRANSFORMATION PLAN—APPENDIX M—EFFICIENCY-BASED STRATEGIES