For the first time in recent history, FedEx has announced their service rate increase; both express AND ground, before UPS. The FedEx rate change will be effective Monday, January 5TH, 2015. FedEx has announced that their ground and express rates will take a general rate increase of 4.9%.
This is certainly the earliest that FedEx has announced its annual rate increase, but the announcement really began back on May 2, 2014 when they announced the change to the ground dimensional weight pricing rule as it will apply to all ground packages (please refer to our earlier Parcel posting for details). Although FedEx announced an overall increase of 4.9% on the ground packages, the average increase for base rates does not tell the whole story. For example, the ground zone 2, 1 lb. minimum has increased 5.93%, higher than the announced increase, though not nearly as high as the 6.8% increase from last year. However, many lightweight ground cells are taking increases approaching and in some cases over 7%. The 1-5 lb ground packages are averaging an increase of 6.4%, well beyond the announcement as well. Additionally, the seldom used 71-150 lb. cells are only increasing 1.9%, which is driving the overall average increase down. The Ground Residential Surcharge is increasing 6.9% ($0.20), up from the 3.5% increase that it took last year; The Ground Delivery Area Surcharges are up 5.0%-6.3% depending on category, nearly double last year’s increase. In fact, all of the ground rates from 1 through 18 lbs are above the 4.9% average.
FedEx has also announced that their rate increase for air and international services is also 4.9%, once again with no offset to the fuel surcharge index. The base rates may average the announced increases; however, the following synopsis will highlight some particularly hard hit services and areas. Although very light weight higher zone Priority Overnight shippers will see increases in the 4.4% range, as soon as the weight gets over 9 lbs they will experience increases in the 7%-9% range. Surcharges for residential air deliveries are up 4.5%, up from 3.1% last year, while the delivery area surcharge is up 4.4% for commercial and residential, and in extended areas 4.1%. The following analysis compares the FedEx Standard rates from 2014 vs. 2015. Once UPS announces their increase we will provide further analysis and guidance.
It is important to realize that these announced rate increases are only averages and the impact to your company could vary greatly. To determine the real impact of this rate increase to your specific business and shipments contact AFMS for a detailed rate impact analysis at 800-246-3521 or visit us at www.afms.com.
Download the PDF to see charts of some of the key changes!
View
View 2015fedex.pdf
This is certainly the earliest that FedEx has announced its annual rate increase, but the announcement really began back on May 2, 2014 when they announced the change to the ground dimensional weight pricing rule as it will apply to all ground packages (please refer to our earlier Parcel posting for details). Although FedEx announced an overall increase of 4.9% on the ground packages, the average increase for base rates does not tell the whole story. For example, the ground zone 2, 1 lb. minimum has increased 5.93%, higher than the announced increase, though not nearly as high as the 6.8% increase from last year. However, many lightweight ground cells are taking increases approaching and in some cases over 7%. The 1-5 lb ground packages are averaging an increase of 6.4%, well beyond the announcement as well. Additionally, the seldom used 71-150 lb. cells are only increasing 1.9%, which is driving the overall average increase down. The Ground Residential Surcharge is increasing 6.9% ($0.20), up from the 3.5% increase that it took last year; The Ground Delivery Area Surcharges are up 5.0%-6.3% depending on category, nearly double last year’s increase. In fact, all of the ground rates from 1 through 18 lbs are above the 4.9% average.
FedEx has also announced that their rate increase for air and international services is also 4.9%, once again with no offset to the fuel surcharge index. The base rates may average the announced increases; however, the following synopsis will highlight some particularly hard hit services and areas. Although very light weight higher zone Priority Overnight shippers will see increases in the 4.4% range, as soon as the weight gets over 9 lbs they will experience increases in the 7%-9% range. Surcharges for residential air deliveries are up 4.5%, up from 3.1% last year, while the delivery area surcharge is up 4.4% for commercial and residential, and in extended areas 4.1%. The following analysis compares the FedEx Standard rates from 2014 vs. 2015. Once UPS announces their increase we will provide further analysis and guidance.
It is important to realize that these announced rate increases are only averages and the impact to your company could vary greatly. To determine the real impact of this rate increase to your specific business and shipments contact AFMS for a detailed rate impact analysis at 800-246-3521 or visit us at www.afms.com.
Download the PDF to see charts of some of the key changes!
View
View 2015fedex.pdf
