Shippers, FedEx has released its peak season surcharges.
Additional Handling, Oversize, and Ground Unauthorized peak season surcharges will be in effect from September 30, 2024 to January 19, 2025.
Domestic Express, Ground Residential, Home Delivery, and Ground Economy per package peak season surcharges will be in effect from October 28, 2024, to January 19, 2025.
Additional Handling, Oversize, & Ground Unauthorized
Following in UPS’s footsteps, FedEx is also assessing its large package peak season surcharges for an extra week compared to last year. Like UPS, FedEx is breaking its peak season surcharges into three periods rather than enforcing a single rate throughout the entire season.
A “peak” peak season month with exceptionally high rates is bookended by two periods with rates shippers may consider more standard, though still high in comparison to the 2022 to 2023 year-over-year increases.
All rates listed below are per package:
September 30, 2024 – November 24, 2024
- Additional Handling: $7.75
- +$0.80 from 2023
- +$1.20 from 2022
- Equal to UPS 2024 peak season surcharge
- Oversize Charge: $84.50
- +$11.50 from 2023
- +$15.75 from 2022
- -$0.25 compared to UPS 2024 peak season surcharge
- Ground Unauthorized Package Charge: $450.00
- +$40.00 from 2023
- +$65.00 from 2022
- +$5.00 compared to UPS 2024 peak season surcharge
November 25, 2024 – December 29, 2024
- Additional Handling: $10.00
- +$3.05 from 2023
- +$3.45 from 2022
- +$0.05 compared to UPS 2024 peak season surcharge
- Oversize Charge: $100.00
- +$27.00 from 2023
- +$42.75 from 2022
- +$1.00 compared to UPS 2024 peak season surcharge
- Ground Unauthorized Package Charge: $500.00
- +$90.00 from 2023
- +$115.00 from 2022
- +$5.00 compared to UPS 2024 peak season surcharge
December 30, 2024 – January 19, 2025
- Additional Handling: $7.75
- +$0.80 from 2023
- +$1.20 from 2022
- Equal to UPS 2024 peak season surcharge
- Oversize Charge: $84.50
- +$11.50 from 2023
- +$15.75 from 2022
- -$0.25 compared to UPS 2024 peak season surcharge
- Ground Unauthorized Package Charge: $450.00
- +$40.00 from 2023
- +$65.00 from 2022
- +$5.00 compared to UPS 2024 peak season surcharge
All Domestic Express, Ground Residential, Home Delivery, and Ground Economy Shipments (No Volume Requirement)
Like UPS, FedEx is bringing back the peak season surcharge on all Domestic Express, Ground Resi, Home Delivery, and Ground Economy shipments with no volume requirements—meaning if you ship, you’ll be hit with a peak season surcharge, even low-volume shippers.
These per-package surcharges will be in effect from October 28, 2024, to January 19, 2025. Like UPS, the peak season period is one week longer in comparison to 2023 (October 30, 2023 – January 14, 2024).
In the footnotes, FedEx also states that these Demand Surcharges are separate and distinct from the Demand Surcharge in effect for certain International and Ground Economy shipments. FedEx warns shippers that, “Any existing contractual discounts or waivers a customer may have on international and FedEx Ground Economy services will not apply to the Demand Surcharge going into effect for shipments tendered on or after August 15, 2024, using these services.” (Source: Demand Surcharges | FedEx https://www.fedex.com/en-us/shipping/rate-changes/demand-surcharges.html)
All rates listed below are per package:
October 28, 2024 – November 24, 2024
- Domestic Express: $1.00
- Equal to UPS 2024 peak season rate
- Ground Resi & Home Delivery: $0.30
- +$0.05 compared to UPS 2024 peak season surcharge
- Ground Economy: $1.90
- +$0.30 from 2023
- +$0.40 from 2022
- +$1.65 compared to UPS SurePost peak season surcharge
November 25, 2024 – December 29, 2024
- Domestic Express: $2.00
- Equal to UPS 2024 peak season rate
- Ground Resi & Home Delivery: $0.55
- +$0.05 compared to UPS 2024 peak season surcharge
- Ground Economy: $3.15
- +$0.55 from 2023
- +$0.65 from 2022
- +$2.65 compared to UPS SurePost peak season surcharge
December 30, 2024 – January 19, 2025
- Domestic Express: $1.00
- Equal to UPS 2024 peak season rate
- Ground Resi & Home Delivery: $0.30
- +$0.05 compared to UPS 2024 peak season surcharge
- Ground Economy: $1.90
- +$0.30 from 2023
- +$0.40 from 2022
- +$1.65 compared to UPS SurePost peak season surcharge
There’s one very notable difference in fees between FedEx and UPS here. Ground Economy, compared to its UPS analogue, SurePost, ranges from 530% ($0.50 to $3.15) to 660% ($0.25 to $1.90) more expensive, per package, than SurePost.
Volume-Based: Domestic Express, Ground Residential, Home Delivery, and Ground Economy Shipments
Structurally, the volume-based peak season surcharges are the same as last year. However, once again, shippers will incur an extra week of peak season surcharges (Oct 28, 2024 – Jan 19, 2025, compared to Oct 30, 2023 – Jan 13, 2024).
FedEx’s volume-based peak season surcharges share many similarities with UPS. However, there are some notable differences.
Let’s start with the similarities.
Like UPS, FedEx determines your “baseline” based on your average weekly volume from June 2024 – specifically, weekly average residential (excluding One Rate) and FedEx Ground Economy packages shipped between June 3, 2024, and June 30, 2024.
Also, like UPS, FedEx has a 20,000 minimum package threshold that needs to be met before these additional volume-based surcharges are applied.
However, FedEx and UPS differ in determining how that 20,000 threshold is crossed.
FedEx makes a weekly determination. If you ship more than 20,000 residential (excluding One Rate) and FedEx Ground Economy packages and ship volume that’s 105% or greater than your established baseline during a Calculation Week, you will be assessed the additional, volume-based surcharge on the corresponding Application Week.
FedEx will take the peaking factor determined during the calculation week, and apply it to every package shipped during the application week, regardless of volume shipped during the application week.
Application Weeks align with FedEx’s peak season dates, October 28, 2024, to January 19, 2025.
Calculation weeks run parallel to peak season, separated by three weeks. Calculation weeks begin October 7, 2024, and end December 23, 2024.
There’s also one caveat to calculation weeks: if a calculation week contains a holiday, FedEx will estimate what your weekly volume would have been had the week not contained a holiday based on that week’s actual volume. For example, if you shipped 4,000 packages over four days, for the purposes of applying the Residential Delivery Charge, your weekly volume would be considered 5,000 packages (4,000 x 5 / 4).
Simple, right?
Here’s how it’s different than UPS. FedEx has “calculation weeks” and UPS essentially has a calculation year. If, in any single week, following October 2023, you shipped more than 20,000 packages, you’re on the hook for UPS’s volume-based residential surcharges for the entirety of the peak season. If you’ve had a 20k week in the past year, and if you ship 105% of your June 2024 weekly average volume (“baseline”), you will be assessed the surcharge.
Essentially, the difference between the 20,000 package thresholds is that FedEx’s application creates scenarios wherein it’s possible to have shipped over 20,000 packages in a week over the past year, then ship over 105% of baseline volume during peak season and not incur the surcharge (for example, shipping 105% of baseline but under 20,000 packages in a calculation week).
UPS’s threshold application means that you will always incur the additional surcharge if your weekly volume is 105% of baseline as long as you shipped over 20,000 in a single week dating back to October 2023.
This difference would be most significant to small/medium-volume shippers who hover around 20,000 packages per week during peak. For example, a shipper with a baseline of 10,000 packages per week whose peak weekly volume fluctuates from 15,000 to 25,000, with some weeks being above the 20,000 threshold and some weeks being below. A shipper like this may incur the peaking surcharge every single peak week with UPS, but only a handful of weeks with FedEx.
While that may sound good to some SMB shippers, consider, again, the huge difference in FedEx’s Ground Economy per package surcharge (with no volume requirement!) and UPS’s SurePost – two very common services for SMBs, and shippers in general. If you’re struggling to math out cost-optimal peak season service and carrier usage, contact us for assistance.
Another difference between the carriers’ volume-based surcharges: UPS states that if your average weekly volume from September 1, 2024 – September 28, 2024 is less than 80% of your average June volume, they will adjust your baseline calculation to be based on your September volume instead of your June volume. FedEx has no such language in their announcement.
Basically, your big blowout June sale won’t save you from UPS’s additional peak resi surcharge.
As far as the fee itself, FedEx’s volume-based peak season surcharges are largely similar to UPS’s, ranging from $0.05 less than UPS’s to $0.10 more (with more on the “more” side than the “less” side).
Like last year, and like UPS, there are six peaking tiers ranging from 105% to >400% of baseline volume. Surcharges are effective from October 28, 2024 – January 19, 2025.
105% to >400% (per package)
- Ground and Home Delivery: $1.45 – $7.10
- +$0.10 to +$0.75 from 2023
- +$0.20 to +$1.05 from 2022
- Express Services (Excluding One Rate): $2.60 – $8.25
- +$0.20 to +$0.85 from 2023
- +$0.35 to +$1.25 from 2022
As a reminder, these fees are in addition to the per package fees mentioned above that are applied to every shipment regardless of volume.
Full peak season details and tables can be found at: Demand Surcharges | FedEx
