FedEx Follows UPS With Shipping Rate Increase

FedEx has announced plans to plans to raise its shipping rates starting next year, following UPS's rate increase that went into effect Monday.

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FedEx has announced plans to plans to raise its shipping rates starting next year, following UPS's rate increase that went into effect Monday.

FedEx said that effective, Jan. 2, 2017, its ground and home-delivery services rate will increase 4.9 percent, while its air-shipping express service rate will rise 3.9 percent. The rate change applies to eligible FedEx Freight shipments within the U.S., between the contiguous U.S. and Canada, within Canada, between the contiguous U.S. and Mexico and within Mexico.

The company detailed a number of other adjustments: 

  • Effective Jan. 2, 2017, the FedEx Express and FedEx Ground U.S. domestic dimensional weight divisor will change from 166 to 139.
  • Effective Feb. 6, FedEx Express and FedEx Ground fuel surcharges will be adjusted on a weekly basis, which FedEx says will reduce lag time between U.S. Government published fuel indexes and fuel surcharges from two months to two weeks.
  • The FedEx SameDay City pricing changes for calendar 2017 will be announced later this year.
  • Effective Jan. 2, the FedEx Freight Extreme Length surcharge will change from $85 to $150 and will be applied to shipments with dimensions of 12 feet or greater versus the prior 15 feet.

FedEx's news came after UPS's on Sept. 1, when it announced a new freight service rate hike of 4.9 percent that was effective Sept. 19. Effective Dec. 26, UPS's Air and International services will also increase 4.9 percent.

UPS said the rate increase is to help pay for added investments in system upgrades and expansion.

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