Breaking down the 2020 FedEx Rate and Surcharge Increases

What to be aware of going into the new year

Although FedEx’s peak season surcharges end just after the beginning of the new year, shippers should also be aware of the looming 2020 carrier rate changes. While these increases are fairly consistent with years past, they can add up.

Shippers will see the same general rate increase as they did in 2019. Beginning January 6, 2020 FedEx will implement an average increase of 4.9% for Express, Ground and Home Delivery services and an average increase of 5.9% for Freight services.

To put the increase into context, below is what shipping a 2-pound box to Zone 2 looks like currently versus after the rate increase goes into effect.

It is important to note the general rate increases are an average and will vary based upon package dimensions, weight and zone. Heavy or oversized packages being sent long-zone or to remote areas will see a greater increase.

In addition to the general rate increase there are a few evolving (and increasing) surcharges that you should be aware of. These changes will go into effect on January 20, 2020, after the general rate increase.

Below are some of the key surcharge changes you should keep an eye out for:

Additional Handling

·       A weight surcharge will now apply to FedEx Express® U.S. domestic and FedEx Ground® U.S. domestic packages if a package has an actual weight greater than 50 lbs. (previously 70 lbs.)

·       The surcharge will also now apply to U.S. import-rated shipments if a freight handling unit measures greater than 62 inches along its longest side (previously 70 inches).

Oversize Surcharge

·       For FedEx Express U.S. international shipments, the surcharge will now apply, but these shipments will not be subject to a 90-lb. minimum billable weight.

Fuel Surcharge

Fuel surcharges fluctuate weekly and are designed to help carriers offset sudden fuel price increases. Most major carriers impose fuel surcharges on top of the basic shipping rate. Beginning on January 20, 2020, FedEx will begin assessing fuel surcharges on surcharges. That’s right, a surcharge for surcharges. 

 

 

 

FedEx Fuel Surcharge Eligible Surcharges (Effective 1/20/20)
Service Surcharge
FedEx Express Shipments

·       Additional Handling Surcharge

·       Additional Handling Surcharge – Non-stackable

·       FedEx® Delivery Signature Options

·       FedEx® Collect on Delivery

·       Peak – Additional Handling Surcharge

FedEx Ground Shipments

·       Additional Handling Surcharge

·       FedEx Delivery Signature Options

·       FedEx Ground® C.O.D.

·       FedEx Ground® Electronic C.O.D.

·       FedEx Home Delivery® Convenient Delivery Options

·       Peak – Additional Handling Surcharge

 

Rate and surcharge increases are inevitable there may be some positive news on the horizon. Earlier this year, FedEx announced it plans to offer seven-day residential delivery in the U.S. as it seeks to capture more of the e-commerce surge.

For more information on ever changing rates & services and other 2020 carrier updates visit Rate Change Central.