UPS Rates Going Up December 26
UPS has announced their annual general rate increase (GRI) of 5.9% effective December 26, 2021. This mirrors the FedEx GRI announcement and is 1% higher than previous years.
While carriers have announced an unprecedented increase of 5.9%, total costs will likely rise more than 5.9%. This is largely driven by 1-5 lb. small parcel shipping rates taking far higher increases, up to 12% depending on the service.
2021 Zonal Increases
| Domestic | Zone 2 | Zones 3-4 | Zones 5+ | Zones 6+ | Zones 7+ |
|---|---|---|---|---|---|
| Weight | $24.00 | $25.50 | $27.00 | $27.00 | $27.00 |
| Length + Girth | $15.00 | $16.00 | $18.00 | $18.00 | $18.00 |
| Length | $15.00 | $16.00 | $18.00 | $18.00 | $18.00 |
| Width | $15.00 | $16.00 | $18.00 | $18.00 | $18.00 |
| Packaging | $14.00 | $15.00 | $16.00 | $16.00 | $16.00 |
| International | $16.00 | $16.00 | $16.00 |
Source: 2021 UPS Rate & Service Guide
We encourage shippers to review the exact changes to see how they impact their shipment profile and spend. Better yet, contact the experts at ConData to see how these increases will impact your bottom line.
In addition to base rates increases, it’s important for shippers to pay close attention to the rate increase for accessorials – which reflect about 30% of total costs for most shippers. Accessorial rates have increased over 30% in the last 4 years, and several are increasing by more than 10% from 2021 to 2022.
2021 Zonal Increases
| Domestic | Zone 2 | Zones 3-4 | Zones 5+ |
|---|---|---|---|
| Weight | $24.00 | $25.50 | $27.00 |
| Length + Girth | $15.00 | $16.00 | $18.00 |
| Length | $15.00 | $16.00 | $18.00 |
| Width | $15.00 | $16.00 | $18.00 |
| Packaging | $14.00 | $15.00 | $16.00 |
| International | $16.00 | $16.00 | $16.00 |
Source: 2021 UPS Rate & Service Guide
In addition to Residential and Delivery Area Surcharges, UPS is penalizing heavy or bulky item shippers with Additional Handling, Weight (12.36%) and UPS’ Large Package, Commercial (13.65%). With assessorials layered over, many shippers will see a much larger than 5.9% cost increase.
Additional observations from The ConData team:
- UPS recently announced a 1% increase to their fuel surcharge which impacts base rates and several accessorial charges. This is the second fuel surcharge increase in the last six months, amounting to a 1.75% increase in total.
- New surcharges are being introduced which include the UPS US48 Remote Area Surcharge (RAS) fee and a $1.00 charge FedEx is now adding to all deliveries on the New FedEx Economy service. Unless shippers negotiate these new surcharges with their carriers prior to the charges being instituted, they will be paying these surcharges absent any discount.
UPS and FedEx shipping rates reflect their focus on increasing profits through a multitude of charges and increases. While negotiating with carriers is difficult, ConData can help. We know how to negotiate deep discounts for rates and surcharges, and we’ve been able to save shippers between 15-20% in 2021.
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