FedEx and UPS Rates on the Rise: PartnerShip Issues Report on 2024 Rate Increases
FedEx and UPS plan to bump their rates by an average of 5.9% in 2024. While this percentage may appear small, additional fees and other adjustments will cause actual shipping costs to rise even higher.
According to NATDA Benefit Partner, PartnerShip, FedEx and UPS have a long history of mirroring each other’s pricing. They typically announce the same General Rate Increase (GRI) and appear to have similar pricing strategies.
For 2024, both FedEx and UPS are facing a slowdown in demand, as indicated by a GRI that is less aggressive than the increase we saw for 2023. Let's do a quick history lesson. In 2022 the carriers took a 5.9% increase and then bumped that up to an all-time high of 6.9% in 2023. That was thanks, in part, to all the supply chain disruptions and surges in demand that resulted from the pandemic. For several years prior to that, both carriers had been raising their rates annually by an average of 4.9%.
This year, FedEx made their GRI announcement earlier than they typically do, and many speculated it was a way to put pressure on UPS. Over the summer, UPS faced threats of a driver strike and during the heated negotiations, the carrier lost some business to its competitors. While UPS and the Teamsters eventually averted a strike and came to an agreement, the new contract comes with a steep increase in labor costs. Many were expecting a higher GRI in 2024 from UPS as a result.
For a deep dive into the FedEx and UPS rate changes for 2024, check out the complete report from PartnerShip.
PartnerShip is a NATDA Benefit Partner that offers NATDA members discounts on shipping and freight services, including FedEx, TForce Freight, YRC, XPO and others. Working with PartnerShip is like having the benefit of your own dedicated shipping department without the expense of having your own dedicated shipping department. Its network of carrier partners, strong industry relationships, and shipping expertise give you peace of mind that only comes from working with a trusted partner.
To learn more about the benefits of becoming a NATDA Member, click here.