In a move mirroring its main competitor, FedEx, which unveiled its 2024 rate adjustments in late August, UPS, the global freight transportation and logistics provider headquartered in Atlanta, has now announced its rate changes for 2024.
The new UPS rates are scheduled to take effect from December 26, 2024.
According to UPS officials, these rate modifications are aimed at supporting the company’s ongoing expansion and the enhancement of its services to maintain the high service standards that customers expect.
Starting on December 26, UPS will implement an average net increase of 5.9% for rates across UPS Ground, UPS Air, and International services, aligning with FedEx’s planned 2024 rate adjustments. For air cargo, as of December 3, UPS Air Freight rates within and between the United States, Canada, and Puerto Rico will experience an average net increase of 6.3%.
Additionally, UPS will also introduce increases in rates for specific Value-Added services and Other charges, effective December 26. For instance, the Zone 2 Additional Weight Handling rate will rise by 16%, going from $29.00 to $34.50, and the Zone 2 Dimensions (Length, Width, Length+Girth) will increase by 16%, from $18.50 to $22.00.
Furthermore, starting on December 26, an Additional Handling fee will be imposed on international shipments weighing 55 pounds or more. UPS has also stated that when a commercial fee is submitted in connection with a shipment, a fee of up to $5.00 per shipment will be applied to the shipper if the commercial invoice is not provided in digital form using UPS Paperless Invoice services before the processing of the commercial invoice by UPS.
A detailed analysis of the 2024 rate adjustments for UPS and FedEx by Paul Yaussy, senior consultant for Shipware, a parcel consultancy based in San Diego, highlights that the majority of common surcharges will increase significantly beyond the announced 5.9% GRI.
Yaussy notes, “Most people read the headlines or the email from their carrier representative and assume that all their rates are increasing by 5.9%. However, one must exercise caution, as relying solely on the annual GRI announcement does not limit surcharge increases to the 5.9% rate hike. This year, many common surcharges will experience substantial increases, and depending on a shipper’s specific profile, these changes can have a significantly adverse impact on parcel pricing. Surcharges typically account for between 20% and 40% of a parcel shipper’s annual expenses. Therefore, it is crucial to understand the implications of these rate adjustments. Notably, shippers of oversized packages will once again face a significant impact, with Additional Handling surcharges and Large Package surcharges increasing by an average of 19.5%.”
Jerry Hempstead, president of Hempstead Consulting, based in Orlando, explained that when delving into the details of UPS’s new rates, the company applied increases far greater than 5.9% in two key areas.
“First, most accessorial charges saw substantial increases, particularly Additional Handling and Oversize, which experienced double-digit increases. It’s important to note that these surcharges are subject to the fuel surcharge (currently over 16% for Ground). The Delivery Area Surcharges are surcharges that will notably affect most parcel shippers, as they have been increasing by more than 5.9% this year, with an increase of over 7%. The second significant detail in all of this is UPS’s alteration of the classification of numerous zip codes, affecting both zone application and extended area identification.”
