By Lily Kuo
WASHINGTON (Reuters) - The U.S. Postal Service said it is abandoning for now its plan to close thousands of post offices in rural locations and will instead keep them operating with shorter opening hours.
The cash-strapped agency faced significant backlash from Congress and communities last summer when it began considering about 3,600 post offices for closure this year.
Instead, now 13,000 post offices with low traffic will shorten their operations to between two and six hours a day.
"We've listened to our customers in rural America and we've heard them loud and clear - they want to keep their post offices open," said Postmaster General Patrick Donahoe. "There's no plan for closings at this point."
The Postal Service's decision to pull back on the cost-cutting measure underscores how difficult it will be to restructure the agency, which has been losing billions of dollars each year as Americans increasingly communicate online.
Barring drastic changes, officials have said the mail agency could face annual losses of $18 billion by 2015.
Donahoe estimated the plan announced on Wednesday would save the Postal Service half a billion dollars annually, and would not be completely implemented until September 2014.
The agency is now seeking regulatory approval for the new strategy.
Lawmakers had criticized the agency for focusing on small, money-losing post offices without considering factors such as community impact or Internet access. A Reuters investigation determined that about one-third of the post offices facing closure were located in areas with limited or no wired broadband.
The Postal Service has announced plans to contract with local general stores to offer some postal services and to use more rural letter carriers, who serve as a post office on wheels, in areas where post offices close.
Communities can choose to use these "village post offices" in conjunction with fewer hours at their post offices.
The Postal Service also said it was offering more than 21,000 postmasters a buy-out to retire from the service by the end of July.
(Additional reporting by Emily Stephenson; Editing by Anthony Boadle)