As Expected, an Average 4.9% Rate Increase Announced by FedEx

September 19, 2019


Earlier this week, Paul Ziobro, journalist with the Wall Street Journal, noted in a Tweet, “Death, taxes and a major carrier -- FedEx -- announcing exactly a 4.9% rate increase for the next year.” Indeed, the day before FedEx announced disappointing first quarter earnings, the company released their average rate increase and other fees for 2020 as well as their 2019 Peak Season surcharges.

As Paul alluded to in his tweet, the average 4.9% rate increase has become an annual event for six consecutive years. But, remember, it is an average increase. The devil is in the details and as we caution clients, the real increase can be found in the accessorials.

But first, Peak Season surcharges – big increases as compared to last year and, like UPS, Fedex is extending the surcharge cheer from November 14-Dec 24 in 2018 to this year’s Oct 21-Jan 5 for Unauthorized and Oversize charges and Nov 18-Jan 5 for Additional Handling charges:

 

Charge 2018 (per package) 2019 (per package) % Change
Additional Handling $3.20 $4.10 28.1%
Ground Unauthorized Package $150.00 $435.00 290.0%
Oversize Charge $27.50 $37.80 37.5%

 

Meanwhile, an eighty-page preview of 2020 charges is available on FedEx’s website and to view 2020 surcharges, a separate website is available.

A sampling of 2020 surcharges, effective January 6, are:

Charge 2019 (per package) 2020 (per package) % Change
Additional Handling – Ground $13.50 $15.00 11.1%
Address Correction $16.00 $17.00 6.3%
Delivery Area Surcharge – Residential $4.20 $4.40 4.8%
Delivery Area Surcharge – Res Extended $4.65 $5.40 16.1%
Oversize – Ground $90.00 $100.00 11.1%
Oversize – Home Delivery* $90.00 $120.00 33.3%
Residential Delivery Charge $4.40 $4.65 5.7%

 

  • Note that Oversize charges for Ground and Home Delivery are now separate and at different rates.

 

Our CEO, John Haber briefly commented on LinkedIn, “Surprise - another “supposed” 4.9% increase from #FedEx - the devils in the details.” Indeed they are.

We will provide additional analysis when UPS announces their 2020 increases. But, until then, contact us if you have questions on how FedEx’s 2020 charges may impact your shipping.

 

 

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As Expected, an Average 4.9% Rate Increase Announced by FedEx

September 19, 2019


Earlier this week, Paul Ziobro, journalist with the Wall Street Journal, noted in a Tweet, “Death, taxes and a major carrier -- FedEx -- announcing exactly a 4.9% rate increase for the next year.” Indeed, the day before FedEx announced disappointing first quarter earnings, the company released their average rate increase and other fees for 2020 as well as their 2019 Peak Season surcharges. As Paul alluded to in his tweet, the average 4.9% rate increase has become an annual event for six consecutive years. But, remember, it is an average increase. The devil is in the details and as we caution clients, the real increase can be found in the accessorials. But first, Peak Season surcharges – big increases as compared to last year and, like UPS, Fedex is extending the surcharge cheer from November 14-Dec 24 in 2018 to this year’s Oct 21-Jan 5 for Unauthorized and Oversize charges and Nov 18-Jan 5 for Additional Handling charges:  

Charge 2018 (per package) 2019 (per package) % Change
Additional Handling $3.20 $4.10 28.1%
Ground Unauthorized Package $150.00 $435.00 290.0%
Oversize Charge $27.50 $37.80 37.5%
  Meanwhile, an eighty-page preview of 2020 charges is available on FedEx’s website and to view 2020 surcharges, a separate website is available. A sampling of 2020 surcharges, effective January 6, are:
Charge 2019 (per package) 2020 (per package) % Change
Additional Handling – Ground $13.50 $15.00 11.1%
Address Correction $16.00 $17.00 6.3%
Delivery Area Surcharge – Residential $4.20 $4.40 4.8%
Delivery Area Surcharge – Res Extended $4.65 $5.40 16.1%
Oversize – Ground $90.00 $100.00 11.1%
Oversize – Home Delivery* $90.00 $120.00 33.3%
Residential Delivery Charge $4.40 $4.65 5.7%
 
  • Note that Oversize charges for Ground and Home Delivery are now separate and at different rates.
  Our CEO, John Haber briefly commented on LinkedIn, “Surprise - another “supposed” 4.9% increase from #FedEx - the devils in the details.” Indeed they are. We will provide additional analysis when UPS announces their 2020 increases. But, until then, contact us if you have questions on how FedEx’s 2020 charges may impact your shipping.    

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