As the 2024 peak shipping season approaches, both FedEx and UPS have released their updated surcharges, giving businesses crucial insights into managing their shipping costs during the busiest time of the year. Along with higher demand comes the increased risk of lost or damaged packages, making it essential to understand the surcharge structure, audit charges, and be prepared for potential shipping issues.
FedEx 2024 Peak Season Surcharges
Additional Handling Surcharge
FedEx will apply this surcharge during three key periods:
Peak period | 2024 charge | 2023 charge | % increase |
09/30/24 - 11/24/24 | $7.75 per package | $6.95 per package | 11.51% |
11/25/24 - 12/29/24 | $10 per package | $6.95 per package | 43.88% |
12/30/24 – 1/19/25 | $7.75 per package | $6.95 per package | 11.51% |
This surcharge applies to packages greater than 50 pounds or size limits, or non-standard packaging (e.g., cylindrical items).
Oversize Charge
For oversized or overweight packages:
| Peak period | 2024 charge | 2023 charge | % increase |
9/30/24 – 11/24/24 | $84.50 per package | $73 per package | 15.75% |
11/25/24 – 12/29/24 | $100 per package | $73 per package | 36.99% |
12/30/24 – 1/19/25 | $84.50 per package | $73 per package | 15.75% |
It applies to packages greater than 50 pounds and/or exceeding 108 inches in length or a combined length and girth over 165 inches.
Unauthorized Package Charge
For oversized or overweight packages
Peak period | 2024 charge | 2023 charge | % increase |
9/30/24 – 11/24/24
| $450 per package | $410 per package | 9.76% |
9/30/24 – 11/24/24
| $500 per package | $410 per package | 21.95% |
12/30/24 – 1/19/25
| $450 per package | $410 per package | 9.76% |
It applies to packages greater than 50 pounds and/or exceeding 108 inches in length or a combined length and girth over 165 inches.
Demand Surcharge
FedEx may apply a demand surcharge during periods of elevated demand. This surcharge is aimed at covering the costs of increased operational strain. The rates and application periods can vary based on volume and delivery destinations, so it's important to track FedEx communications during the peak season.
Service type | Peak period | 2024 Amount |
FedEx First Overnight® FedEx Priority Overnight® FedEx Standard Overnight® FedEx 2Day® A.M FedEx 2Day® FedEx Express Saver®* | 10/28/24–11/24/24 11/25/24–12/29/24 12/30/24–1/19/25 | $1 per package $2 per package $1 per package |
FedEx Ground residential FedEx Home Delivery residential | 10/28/24–11/24/24 11/25/24–12/29/24 12/30/24–1/19/25 | $0.30 per package $0.55 per package $0.30 per package |
FedEx Ground® Economy | 10/28/24–11/24/24 11/25/24–12/29/24 12/30/24–1/19/25 | $1.90 per package $3.15 per package $1.90 per package |
*Please note: This exclude FedEx One Rate packages
Residential Delivery Charge
In a given calculation week, this surcharge applies to customers who ship more than 20,000 packages to residential addresses. On each calculation week, FedEx will assess the customer's weekly shipping volume and calculate a "peaking factor" that determines whether the surcharge applies.
The peaking factor is calculated by dividing the total number of residential and FedEx Ground Economy packages shipped in a calculation week by the average number of similar packages shipped from June 3, 2024, to June 30, 2024, then multiplying by 100. If this percentage exceeds 105%, the surcharge will be applied to every residential package shipped during the application week, which occurs two weeks after the calculation week. This differs from UPS, which applies a surcharge only to packages shipped above the baseline volume.
FedEx will implement this surcharge from October 28, 2024, through January 19, 2025, with the first calculation week starting on October 7, 2024. This period coincides with the holiday peak season, a time when e-commerce orders tend to surge, increasing demand for residential deliveries.
It’s important for businesses to regularly audit shipping charges during this period to avoid unexpected costs.
% volume baseline
|
>105%-125%
| >125%-150% | >150%-200% | >200%-300% | >300%-400% | >400% |
FedEx Ground, FedEx Home Delivery Services
| $1.45 | $2.10 | $2.40 | $2.95 | $5 | $7.10 |
FedEx Express Services
| $2.60 | $3.25 | $3.55 | $4.10 | $6.15 | $8.25 |
UPS 2024 Peak Season Surcharges
Additional Handling Surcharge
UPS applies similar surcharges:
Peak period | 2024 charge | 2023 charge | % increase |
09/29/24 - 11/23/24 | $7.75 per package | $6.90 per package | 12.32% |
11/24/24 - 12/28/24 | $9.95 per package | $6.90 per package | 44.20% |
12/29/24 – 1/18/25 | $7.75 per package | $6.90 per package | 12.32% |
This applies to packages exceeding specific weight (50lbs+) or dimensional limits (More than 48” on the longest side or more than 30” on the second-longest side), or irregular packaging (Encased or bound with metal, wood, plastic, cloth, etc.).
Large Package Surcharge
For packages exceeding 96 inches in length or a combined length and girth over 130 inches:
Peak period | 2024 charge | 2023 charge | % increase |
09/29/24 - 11/23/24 | $84.75 per package | $74.90 per package | 13.15% |
11/24/24 - 12/28/24 | $99 per package | $74.90 per package | 32.18% |
12/29/24 – 1/18/25 | $84.75 per package | $74.90 per package | 13.15% |
Over Maximum Limits Charge
For extremely large or heavy packages. UPS defines Over Maximum as:
- Any shipment measuring more than 108 inches in length
- A shipment measuring more than 165 inches in length and girth combined
- Any parcel weighing more than 150 lbs
If you need more information about the strict requirements read UPS requirements
Demand Surcharge
This is applied by service type.
Service type | Peak period | 2024 charge |
UPS SurePost® UPS® Ground Residential | 10/27/24–11/23/24 11/24/24–12/28/24
12/29/24–1/18/25
| $0.25 per package $0.50 per package
$0.25 per package
|
UPS® Air Services
| 10/27/24–11/23/24 11/24/24–12/28/24
12/29/24–1/18/25
| $1.00 per package $2.00 per package
$1.00 per package
|
Residential Delivery
This UPS charge will apply to customers who ship more than 20,000 residential packages during a calculation week. Similar to last year, it will vary throughout the demand period depending on how much you ship in a week over your baseline. The baseline period is your average weekly volume for the applicable service level in June 2024, specifically, June 2nd, 2024 – June 29th, 2024.
The demand residential delivery charge determined based on the above will only be applied to packages OVER the baseline, not all packages. This is different from FedEx.
UPS will implement these surcharges from October 27th, 2024 to January 18th, 2025.
% volume baseline
|
>105%-125%
| >125%-150% | >150%-200% | >200%-300% | >300%-400% | >400% |
UPS SurePost® and UPS® Ground Residential
| $1.50 | $2.05 | $2.35 | $2.85 | $4.90 | $7.05 |
UPS® Air Residential Services
| $2.65 | $3.20 | $3.50 | $4.00 | $6.05 | $8.25 |
Managing Lost and Damaged Packages During Peak Season
The increased volume during the holiday season inevitably raises the chances of lost or damaged packages. FedEx and UPS see a spike in complaints during this time, as their networks become strained with higher traffic. Here are some best practices to minimize issues:
- Packaging: Ensure proper packaging with reinforced materials for fragile or oversized shipments.
- Insurance: Consider purchasing additional insurance, especially for high-value items.
- Tracking: Make use of advanced tracking features from both carriers to monitor shipments closely.
- Claims Process: Familiarize yourself with FedEx and UPS claims procedures. File any claims for lost or damaged packages within the stipulated time frame to avoid delays in compensation.
Importance of Auditing Surcharges
One crucial aspect often overlooked during peak season is the need to audit shipping charges. Carriers sometimes apply surcharges incorrectly due to package misclassification or errors in weight and dimension calculations. Overcharges can accumulate quickly, especially during peak season, when surcharges are at their highest.
Regularly auditing your shipping invoices helps ensure that:
- Surcharges are accurate: Verify if the additional handling, oversize, or over-limit fees have been applied correctly.
- Errors are caught early: Identify and dispute any billing discrepancies promptly.
- Costs are controlled: Auditing helps you avoid unnecessary costs, keeping your shipping expenses in check.
Peak season surcharges from FedEx and UPS are increasing by up to 44%, making it essential for businesses to manage package sizes, packaging materials, and shipping methods. Alongside higher costs, the risk of lost and damaged packages rises, and the possibility of billing errors increases. By auditing surcharges, using proper packaging, and insuring valuable goods, you can minimize both shipping costs and disruptions during the hectic holiday season.
Please note: This article focuses on Ground and Express charges. For a full breakdown of international and other charges, see the FedEx & UPS websites.