FedEx announces 2024 rate increase
A change from 2023's unprecedented rate increase
In 2022, FedEx increased rates by 5.9%— the largest increase in a decade. The very next year, it upped rates again. The 2023 rate increase of 6.9% was the most significant year-over-year increase in the company's history.While many expected the 2024 rate hike to mirror 2023's, the carrier surprised many when it announced an average rate increase of 5.9%, which will go into effect on January 1, 2024. FedEx's 2024 rate increase announcement came just four days after the UPS Teamsters approved the new labor contract, which will lock UPS into paying higher wages throughout the contract. Is it a coincidence that FedEx announced lower-than-expected rates as UPS needs to increase its revenue? We don't think so.
Which services are affected by the new rate?
FedEx plans to announce its detailed rates and surcharges on September 7. So far, they have announced that the average rate increase for FedEx Express package services, freight standard list rates for U.S., U.S. export, and U.S. import services, and FedEx Ground standard list is 5.9%.FedEx says NO to "peak" season
As of September 4, 2023, FedEx will wipe every trace of the word "peak" from its corporate vocabulary. The carrier is replacing and rebranding peak season as "demand." FedEx announced, "Demand surcharges are determined for each market based on regular assessments of shipment volume and capacity within our network to accommodate." Increases aren't just a possibility during the holiday season; they can happen anytime.FedEx's 2023/24 demand season rates
For customers using FedEx Express and Ground services between October 2, 2023, and January 14, 2024, here are the new demand rates:- Additional Handling Surcharge - $6.95 per package
- Oversize Charge - $73 per package
- Ground Unauthorized Package Charge - $410 per package
- $1.60 per package from October 30, 2023–November 26, 2023
- $2.60 per package from November 27, 2023–December 10, 2023
- $1.60 per package from December 11, 2023–January 14, 2024
Although the 5.9% rate increase is lower than anticipated, it's still a hefty increase. Before the new rates and demand shipping fees go into effect, audit your current contract with ShipRx. It's free to start, and you only pay when you save money.
ShipRx helps companies save money on shipping through parcel rate negotiation and parcel audit services, so you can save money— even as the carriers raise rates and impose surcharges.